Keel Infrastructure Corp. 10-K

Item 1. Business. 1. Company Overview Bitfarms is a North American digital and energy infrastructure company that develops, owns, and plans to operate data centers and energy infrastructure for HPC and AI workloads. We currently maintain our legacy North American Bitcoin Mining operations to help fund our operations and development efforts. Bitfarms was founded in 2017 and is publicly traded on the Nasdaq and TSX under the ticker symbol “BITF”. On or about April 1, 2026, we expect to complete our U.S. Redomiciliation, pursuant to which shareholders of Bitfarms will exchange their shares for shares of common stock of Keel Infrastructure Corp. (“Keel Common Stock”), a newly formed public company incorporated in the State of Delaware. The Keel Common Stock is expected to begin trading on Nasdaq and the TSX under the ticker “KEEL” two business days following completion of the U.S. Redomiciliation, subject to fulfilling all of the listing requirements of Nasdaq and the TSX, respectively. Our mission is to deliver the infrastructure and energy required to support HPC and AI workloads. We have a portfolio of assets (our “Infrastructure Assets”) that include owned and operated power generation facilities with collocated Bitcoin Mining data centers, established grid interconnections within the wholesale electricity market administered by PJM Interconnection in Pennsylvania, and 100% renewable hydroelectric capacity in Canada and Washington state. Our Infrastructure Assets represent a 2.2 GW power capacity pipeline, comprising 648 MW of secured capacity and 1,513 MW of planned capacity in development, located across our U.S. Sites and our Québec Sites. Currently, our Infrastructure Assets are deployed to support our Bitcoin Mining activities. We are developing our Infrastructure Assets to support HPC data center operations and expect to continue such development in the coming years. 2. Lines of Business and Business Model Our primary growth area is HPC Infrastructure. We expect to operate our Bitcoin Mining assets to the extent they remain profitable and until they are decommissioned to facilitate HPC data center construction. HPC Infrastructure is our primary growth area. We are developing data centers designed to support HPC and AI workloads, with the intention of leasing capacity to hyperscalers, cloud service providers, AI companies, and enterprises under long-term contracts. We expect these contracts to deliver higher cash flows per megawatt and greater revenue predictability than Bitcoin Mining. As of December 31, 2025, this line of business had not yet generated revenue. We anticipate initial data center revenue generation to begin in 2027. See “Risk Factors––Risks Related to HPC Infrastructure Operations.” Bitcoin Mining is our legacy business line, managed for cash generation during the redeployment of our Infrastructure Assets from Mining to HPC data center operations. Currently our Infrastructure Assets are deployed to operate ASIC miners, contributing hashrate to Mining Pools under Full Pay Per Share (“FPPS”) arrangements, with fees paid daily in Bitcoin. During the fiscal year ended December 31, 2025, one Mining Pool operator accounted for 88% of our total revenue. As of December 31, 2025, we operated 113,649 ASIC miners with total hashrate of 14.8 EH/s. We do not plan to invest incremental capital in expanding hashrate and expect Bitcoin Mining to wind down progressively as HPC data center construction begins across our Infrastructure Assets. As of March 27, 2026, Bitcoin Mining is continuing at all of our sites. Our Bitcoin Mining business line also includes revenue, expenses, and capital expenditures associated with the operation of our power generation facilities in Pennsylvania. 1 3. Market Opportunity and Competitive Advantages Market Opportunity Growing enterprise and retail demand for HPC and AI workloads is driving unprecedented buildout of next-generation data centers, with McKinsey estimating that AI data centers may require approximately $5.2 trillion in global capital expenditures by 2030. McKinsey further estimates that AI data center power demand globally may exceed 150 GW by 2030, up from approximately 44 GW today. We believe that this growth exceeds what existing grid infrastructure and generation capacity can readily support. HPC and AI workloads require power densities and cooling architectures that most existing facilities cannot accommodate, while grid interconnection bottlenecks constrain new supply. We believe this imbalance may persist for the foreseeable future and disproportionately benefits developers that already control permitted, interconnected, energized power in high-demand markets. In the context of this market imbalance, we recognized in 2024 that our Infrastructure Assets may constitute the scarce inputs the HPC data center market values most: interconnected, scalable power in established data center regions with robust fiber connectivity. In early 2025, we engaged Appleby Strategy Group (“ASG”) and World Wide Technology (“WWT”) to evaluate the suitability of our Infrastructure Assets for HPC data center development. ASG and WWT identified attractive characteristics across our U.S. Sites and most of our Québec Sites and indicated that these sites were well suited for HPC data center operations. These findings, combined with our core competencies, informed our view that our highest-value path forward was to reallocate our Infrastructure Assets from Bitcoin Mining to HPC data centers. We believe that this is an effective reallocation of our Infrastructure Assets, anchored by an opportunity to shift from a commodity-exposed, cyclical revenue stream to a business that we expect to be underpinned by multi-year lease agreements with higher revenue per unit of power, improved revenue visibility, and stronger risk-adjusted returns compared to Bitcoin Mining. During 2025, we executed on the decision to strategically pivot through a series of acquisitions, capital raises, development commitments, and divestitures that are expected to reposition the Company as a 100% North American digital and energy infrastructure company. Competitive Advantages We believe our platform possesses five structural advantages that differentiate us in the HPC data center market. Scarce, High-Value Power Positions. We believe the quality and location of power interconnections varies materially across the HPC data center market. Grid-connected, permitted, energized capacity in established data center regions represents a key constraint on the development of new HPC and AI supply. Three of our four U.S. Sites are in PJM, one of the largest wholesale electricity markets in the world, with secured interconnections. PJM’s 2025 Regional Transmission Expansion Plan indicates that the incremental transmission enhancements required to serve new power demand for data centers could take more than five years to develop. Moses Lake sits within a major Pacific Northwest data center cluster with low-cost hydroelectric power and constrained new supply, as evidenced by the Grant County Public Utility District imposing load-growth limits on data center customers. Our Québec Sites have a combined 170 MW of capacity from a predominantly renewable electricity supply, largely generated from hydroelectric sources, and offer a differentiated platform within 90 minutes of Montréal. Across these markets, we hold our Infrastructure Assets – grid interconnections, contracted power expansion, owned Behind-the-meter generation, and approximately 1,000 acres of owned land – entitlements that we believe new entrants would need years to assemble. In addition, all of our sites are located in cooler climates that support extended free-cooling periods, which we expect will yield competitive annual average power usage effectiveness (“PUE”) relative to facilities in warmer regions. Proven Infrastructure Development Capability. Over nearly a decade of building one of North America’s largest Bitcoin Mining platforms, we assembled energized capacity, generation assets, grid interconnections, utility relationships, and land positions across multiple jurisdictions. The skills underlying that track record – site development, permitting, electrical infrastructure buildout, utility negotiations, and large-scale load management – translate directly to those needed for the development of HPC data centers. 2 Operational Expertise in Power and Energy Management. We own and operate power generation facilities in Pennsylvania, which provide behind-the-meter power generation for collocated load and supply local grid systems. We also manage complex, flexible electrical loads across multiple regulatory environments, including participating in PJM’s full suite of dispatchable programs and complying with Hydro-Québec industrial tariffs. This institutional knowledge of energy procurement, grid interaction, and real-time load management is central to operating HPC data centers reliably and cost-effectively. Organizational Agility. With approximately 274 employees, we can move quickly on acquisitions, pivot development plans, and allocate capital across concurrent projects. In 2024 and 2025, we executed a full portfolio rebalancing – acquisitions, divestitures, capital raises, development commitments, and the planned U.S. Redomiciliation – in approximately 18 months. Additionally, since mid-2025, we have hired senior executives across a range of functions needed for HPC data center development, including construction, power, operations, and permitting. Financial Capacity. As of March 30, 2026, we have approximately $520 million in liquidity, comprising cash and Bitcoin. We believe that this is sufficient to fund our operations, including development of HPC data centers through permitting and leasing at our Washington, Sharon, and Panther Creek sites without additional external financing, providing execution certainty across multiple concurrent projects. 4. Our Strategy Target Power Assets in Supply-Constrained Geographies Our strategy begins with power. We acquire or control energy-advantaged land positions with grid interconnections, contracted capacity, or on-site generation in power-constrained markets. We are currently focused on three regions: (1) PJM in Pennsylvania, U.S., where interconnection congestion and data center demand growth create significant barriers to entry for new developers; (2) the Pacific Northwest, U.S., where low-cost hydroelectric power, cool climate, and proximity to major technology companies support efficient HPC operations; and (3) Québec, Canada, where predominantly renewable power and proximity to Montréal, a hub for AI research, offer a differentiated platform for customers with sustainability mandates. Focus on Infrastructure Development We are an infrastructure developer, not a cloud or compute service provider. We are growing in two ways: (1) converting existing Infrastructure Assets from Bitcoin Mining to HPC data centers and (2) acquiring additional energy-advantaged positions where existing grid infrastructure can compress HPC data center development timelines relative to greenfield alternatives. By focusing on infrastructure development and ownership, we avoid competing in commoditized compute markets and instead concentrate capital on the advantages of our Infrastructure Assets that are hardest to replicate. De-Risk Before Leasing We intend to secure power and obtain a reasonably firm estimate for the timing of permit approvals before engaging in commercial discussions with potential tenants. By entering such commercial discussions regarding lease negotiations with reduced development risk, shorter time to revenue, and higher actionability, we believe these factors, combined with our positioning in supply-constrained markets, are expected to enhance our ability to negotiate favorable rates and terms under multi-year agreements with creditworthy counterparties. As of the date of this Annual Report, we have not yet entered into any HPC data center lease agreements. Design for the Next Hardware Cycle We are designing substantially all of our HPC data centers to support NVIDIA’s next-generation Vera Rubin GPUs. Vera Rubin is anticipated to deliver much higher energy density than NVIDIA’s current-generation Blackwell architecture, and we believe Blackwell-designed facilities may not be fully compatible with Vera Rubin’s power and cooling requirements. By proactively designing ahead of the anticipated hardware cycle, we aim to position ourselves to capture lease demand in 2027 for Vera Rubin-ready capacity. Moses Lake is designed for NVIDIA GB300 GPUs. There can be no assurance that Vera Rubin will ship on the anticipated timeline, that our design assumptions will prove accurate, or that expected demand will materialize. See “Risk Factors –– Risks Related to HPC Infrastructure Operations –– The Company’s increased focus on developing data centers for HPC and AI workloads may not become profitable in the future and may result in adverse consequences to the Company’s business, results of operations and financial condition.” 3 Case Study: The Stronghold Acquisition – Our Strategy in Action Our March 2025 acquisition of Stronghold illustrates our power-first approach and our strategy of acquiring energy-advantaged positions. The acquisition was opportunistic – Stronghold was capital-constrained and did not have the means to grow its business. At the time of the acquisition, Stronghold had 142 MW of import capacity, 165 MW of power generation capacity, and results from a preliminary load study suggesting that Stronghold could import an additional 250 MW, at some point in the future, at Panther Creek. Since this time, we have significantly derisked the Stronghold assets, expanded their potential power capacity, and begun developing both the Panther Creek and Scrubgrass sites for HPC data centers. After announcing the acquisition, we worked closely with Stronghold and PPL and received a project feasibility report from PPL increasing the incremental power availability at Panther Creek from 250 MW to 350 MW. Following the acquisition, we executed an ESA with PPL, resulting in 350 MW of contracted power capacity. Additionally, we executed an agreement to purchase approximately 200 acres next to Panther Creek to support HPC data center operations, and we have commenced development, including permitting and fiber connectivity. At Scrubgrass, we have submitted load studies to import up to 750 MW of additional power, and we have worked with a natural gas transporter to evaluate the potential to deliver gas to the site in order to supply Behind-the-meter gas-fired generation. The natural gas supplier has indicated that they could provide enough natural gas to support over 550 MW of power generation. As a result of this acquisition and subsequent development efforts, we have added two sites that each have high potential to be large-scale HPC data center campuses. 5. Strategic Transformation Rebalancing the Portfolio Toward North American HPC Data Center Development During 2025 and early 2026, we executed a series of transactions and initiatives that repositioned the Company as a North American digital and energy infrastructure company: ● Stronghold Acquisition: Added two established sites in Pennsylvania with potential for large-scale HPC data centers. ● Exit of Latin American operations: Discontinued all operations in Argentina and agreed to divest, all operations in Argentina and Paraguay for up to $108 million of expected proceeds, and we expect that these divestitures and wind-downs will reduce our go-forward capital commitments by $22 million. ● Moses Lake commitment: Committed $129 million for critical equipment and building materials through a turnkey agreement with Vertiv Group (“Vertiv”) at Moses Lake, our first HPC data center development project. ● Panther Creek expansion: Secured 350 MW of contracted firm power capacity and assembled nearly 320 acres of contiguous land. ● Capital formation: Issued $588 million of 1.375% Convertible Senior Notes due January 15, 2031 (the “Convertible Notes”) to fund the transition of our Infrastructure Assets to HPC data centers (see “Business––Financing Strategy” for additional information). In concert with the U.S. Redomiciliation and rebrand to Keel Infrastructure, these actions support the Company’s pivot from Bitcoin Mining to developing, owning and operating HPC data centers. 4 Building the Capabilities to Execute HPC data centers demand higher standards of redundancy, advanced cooling and power-quality management, fiber connectivity, and customer uptime commitments than Bitcoin Mining facilities. The penalties for poor execution are correspondingly greater. We are building these capabilities along two dimensions: Recruiting specialized expertise. We have hired professionals with direct expertise in HPC data center development, design, construction management, and operations. Our recent hires bring substantial industry experience, with an average of more than 20 years in digital and energy infrastructure and extensive backgrounds in complex construction and HPC data center development. In parallel, in 2025, we appointed Jonathan Mir, with over 25 years of strategic finance and capital markets experience focused on energy infrastructure, as CFO. Partnering with industry-leading firms. We have engaged first-tier companies, including ASG, CBRE, Consertus, Corgan, Gensler, Langan, Syska Hennessy Group, Turner Construction Company, Vertiv, and WWT, to access deep, domain-specific expertise at each development stage, while retaining strategic control over site selection, power procurement, capital allocation, and customer relationships. We believe that this approach mitigates execution risk while we continue to build out permanent internal capabilities, and it positions us to internalize more of the development value chain over time as our team and experience base grows. 6. HPC Infrastructure Portfolio Portfolio Overview Our 2.2 GW pipeline of power capacity, which is part of our portfolio of Infrastructure Assets, is concentrated in markets we believe rank among the highest-value HPC data center regions in North America. The following table summarizes the power capacity of our Infrastructure Assets as of March 27, 2026. We intend to allocate substantially all of this capacity to HPC data centers. Site State/Province Current Energized Capacity (MW) Secured Growth Capacity (MW) Subtotal: Secured Gross Data Center Capacity (MW) Identified Additional Gross Data Center Capacity (MW) Total Pipeline (MW) United States Panther Creek Pennsylvania 60 * 350 350 150 500 Sharon Pennsylvania 30 80 110 – 110 Moses Lake Washington 18 – 18 – 18 Scrubgrass Pennsylvania 63 * – – 1,363 1,363 U.S. Total 171 430 478 1,513 1,991 Canada Sherbrooke Québec 96 – 96 – 96 Baie-Comeau Québec 22 – 22 – 22 Other sites¹ Québec 52 – 52 – 52 Canada Total 170 – 170 – 170 Total 341 430 648 1,513 2,161 * This capacity is not under an ESA; therefore, amounts are excluded from Secured Gross Data Center Capacity. ¹ Includes Cowansville, Saint-Hyacinthe, Magog, and Farnham data centers. Note: Excludes operations in Argentina and Paraguay that have been discontinued or that we have agreed to divest. ● Excluding discontinued operations in Rio Cuarto, Argentina, which have been abandoned due to the halting of the energy supply since May 12, 2025, and economic uncertainty in the region. ● Excluding operations in Paso Pe, Paraguay, which met the criteria to be classified as held for sale as we make a strategic shift towards HPC/AI Infrastructure in North America. We have agreed to sell these assets pursuant to a definitive share purchase agreement entered into on January 2, 2026. The transaction is expected to close in the second quarter of 2026. 5 Key Development Sites Panther Creek Located in eastern Pennsylvania and currently being used for Bitcoin Mining, Panther Creek is our largest near-term development site. We hold 350 MW of contracted firm power under an ESA with PPL (50 MW expected by end of 2026, 300 MW by end of 2027), with additional load studies in process. We plan to provide updates on these load studies over the coming months. We have assembled nearly 320 acres of contiguous land at the site, received zoning board approval for our special exemption zoning request, and submitted our land development plan for approval. Sharon Located in western Pennsylvania and currently being used for Bitcoin Mining, Sharon is a development site with 30 MW currently energized and 80 MW under an ESA, with a related substation expansion under construction. We expect to have total energized utility capacity of 110 MW by the first half of 2027. Moses Lake Located in Washington within a major Pacific Northwest data center cluster where power availability is acutely constrained, Moses Lake is our first HPC data center development project. We have committed $129 million for critical equipment and building materials through a turnkey agreement with Vertiv. Moses Lake will be a purpose-built AI compute facility designed in accordance with the NVIDIA GB300 NVL72 reference architecture. Scrubgrass Located in western Pennsylvania and currently being used for Bitcoin Mining, Scrubgrass has the potential to be our largest site. We have submitted load studies totaling 750 MW and initiated pre-engineering studies with a natural gas transporter to assess the feasibility of delivering natural gas to supply an on-site, Behind-the-meter power generation facility with capacity exceeding 550 MW. Québec Sites Our Québec portfolio comprises eight sites powered predominantly by renewable hydroelectricity, a meaningful differentiator for customers with sustainability requirements. The sites are currently being used for Bitcoin Mining. Feasibility assessments have confirmed suitability for HPC data center development. Most sites are within 90 minutes of Montréal, presenting a potential regional campus model linked via low-latency fiber. We are advancing development readiness through engineering, fiber, and go-to-market workstreams with specialized partners. Development Process Each project in our pipeline progresses through four stages: Land acquisition and power procurement. We secure capacity and power either through utility application and agreement or through acquisition of land with existing contracted power. Principal activities and related costs include permitting, zoning, studies and related activities. Development and permitting. This phase includes the planning and design work needed to permit development and have power delivered to a site. We partner with the communities in which we operate to ensure that our projects are in line with local requirements. Principal costs include permitting, zoning, engineering studies, and procurement of long-lead-time items such as substations. The development and permitting phase concludes when the project reaches full readiness for construction, including all permits, approvals, grid interconnection, and ESAs. This is the first major de-risking milestone in the process of developing HPC data centers. 6 Go to market and lease execution. As projects approach construction readiness and are de-risked, we engage with potential tenants. A signed lease is generally required to enable project-level or parent-level debt financing at a cost lower than we would expect absent such a lease. Construction and commercial operations. Once financing is secured, construction begins, and the site is ultimately commissioned and ready for customer service. 7. Financing Strategy Our capital strategy is designed to fund HPC data center development through permitting, leasing, and construction while maintaining financial flexibility to operate across multiple concurrent sites. Our current financing framework includes two primary components, among other options: Project-level and/or parent-level debt financing. The Macquarie Credit Facility provided up to $300 million for HPC data center development at Panther Creek, secured by Panther Creek assets. We drew $100 million in 2025 and subsequently repaid this amount in February 2026 to avoid negative carry and balance sheet complexity, given the amount of cash on our balance sheet to fund near-term development. As we lease sites, we expect to finance construction through project-level bank debt and/or project-level bonds. Equity-linked financing. In October 2025, we issued $588 million of Convertible Notes (approximately $569 million of net proceeds), bearing interest at 1.375% per annum and maturing January 15, 2031, with a conversion price of approximately $6.86 per share (30% premium to reference price). In connection with this issuance, we entered into capped call transactions, all with a cap price of $11.88 per share. As we progress with HPC data center development, we may raise additional equity financing through convertible debt, public equity offerings, and/or sales of minority equity interests at the project level. We expect to finance the construction phase of development of a site with a combination of the project- and/or parent-level debt and equity-linked sources described above. 8. Competition Demand for HPC and AI workloads continues to outpace the supply of HPC data center capacity, particularly in power-constrained markets. HPC data centers require power densities and cooling architectures that most legacy facilities cannot accommodate, while grid interconnection bottlenecks and extended lead times for critical electrical equipment have further constrained new supply. In HPC Infrastructure, we compete with established colocation and wholesale data center operators, independent developers, hyperscalers developing proprietary capacity, infrastructure-focused investment platforms, and former Bitcoin Mining companies repositioning their assets for HPC data center development. Competition is centered on securing grid-interconnected power, accessing land and permitting entitlements, procuring long-lead-time equipment, attracting engineering talent, and establishing relationships with creditworthy customers. In Bitcoin Mining, we compete with publicly traded and private mining companies for block rewards on the Bitcoin network. We do not plan to invest incremental capital in expanding hashrate and expect Mining to wind down progressively as HPC data center operations commence across our Infrastructure Assets. 9. Team and Capabilities As of March 27, 2026, we had 274 employees across Canada and the United States. None of our employees are represented by a labor union, and we have never experienced a work stoppage. We have built a team that includes both senior professionals in power infrastructure and digital infrastructure, an important combination as HPC data center development requires deep expertise in both domains. Our in-house capabilities span power procurement, utility negotiations, grid management, wholesale energy markets, data center construction oversight, project finance, and capital markets execution. We maintain offices in New York City (New York, U.S.), Toronto (Ontario, Canada), Brossard (Québec, Canada) and Pittsburgh (Pennsylvania, U.S.). We established our New York City office in 2025 as part of our U.S. Redomiciliation plan, and this office will be our principal executive office upon the completion of our U.S. Redomiciliation. 7 As described herein, we have complemented our internal team with a network of industry-leading development partners selected for domain-specific HPC data center expertise. There is a high level of competition for talent across both digital infrastructure and energy engineering, and we invest continuously in attracting and retaining professionals with the cross-disciplinary skills our strategy demands. 10. Power Generation Operations Through Scrubgrass and Panther Creek, we own and operate two waste-to-energy facilities that are designated as qualifying facilities (“QFs”) under the provisions of PURPA and FERC’s implementing regulations under PURPA. Each of Scrubgrass and Panther Creek sells electricity into the PJM electricity markets, and their primary fuel source is coal refuse, which is provided by various third parties. These facilities generate electricity while also consuming and remediating coal refuse, which is considered an environmental liability. As QFs, these facilities are recognized under the applicable regulatory framework as eligible resources alongside other qualifying renewable and alternative energy facilities, including hydroelectric generation. Scrubgrass and Panther Creek earn Tier II AECs and waste coal tax credits for their use of coal refuse as their primary fuel source. In addition, Scrubgrass and Panther Creek may use power generated by their QFs to self supply electricity to data centers indirectly owned by the Company and collocated at each site. 11. Regulation, Intellectual Property, and the Environment Regulatory Landscape Our business is subject to extensive U.S. and Canadian federal, state, provincial and local laws. Compliance with, or changes to, the requirements under these legal and regulatory regimes may cause us to incur significant additional costs or adversely impact our ability to compete on favorable terms with competitors. Failure to comply with such requirements could result in the shutdown of a non-complying facility, the imposition of liens, fines, and/or civil or criminal liability and/or costly litigation before the agencies and/or in state of federal court. We operate in a complex and rapidly evolving regulatory environment and we are subject to a wide range of laws and regulations enacted by federal, state, provincial, and local governments, governmental agencies, and regulatory authorities, including the SEC, the Commodity Futures Trading Commission (“CFTC”), the Federal Trade Commission, and the Financial Crimes Enforcement Network of the U.S. Department of the Treasury (“FinCEN”), as well as similar entities in Canada and other countries. Other regulatory bodies, governmental or semi-governmental, have shown an increased interest in companies operating energy-intensive technologies, Bitcoin Mining and use cases related to HPC and AI computing. For example, the energy consumption and environmental impact of data center operations (whether used for Bitcoin Mining or HPC and AI) have received heightened regulatory scrutiny, and future regulations may emphasize energy efficiency, sustainability, and grid reliability in a manner that is different than current conditions. As we expand into the development and ownership of HPC data centers, our facilities may become subject to an increasing number of laws, ordinances, and regulations. Regulators and policymakers are increasingly focused on the governance, ethical use, and potential misuse of HPC and AI systems and advanced computing technologies, as well as cybersecurity, data protection, export controls, and compliance obligations applicable to data center and HPC Infrastructure. Furthermore, Bitcoin and other digital assets are subject to anti-fraud regulations under federal and state commodity and/or securities laws, and digital asset derivative instruments are regulated by the CFTC and SEC. Certain jurisdictions have developed, or are developing, regulatory requirements specifically for digital assets and companies that transact in them. Regulatory frameworks applicable to AI and large-scale computing infrastructure are similarly developing and may vary significantly across jurisdictions. Regulations may substantially change in the future, and it is presently not possible to know how regulations will apply to our business, or when they will be effective. Intellectual Property We utilize specialized hardware and software in our operations, including certain open-source technologies for which we adhere to applicable license terms. We rely on trade secrets, trademarks, and copyright protections, and license intellectual property from third parties. We have one non-provisional patent application under review by the U.S. Patent and Trademark Office and may pursue additional protections in the future. 8 Environmental Matters Our Pennsylvania energy facilities are subject to federal and state environmental laws governing air emissions, water usage, and waste management, and are required to maintain permits administered by the Pennsylvania Department of Environmental Protection. Our operations in Canada operate on approximately 100% renewable hydroelectric energy provided by Hydro-Québec. Our energy mix in 2025 was approximately 65% renewable, 20% waste-to-energy alternative energy, 10% PJM-import, and 5% natural gas. We continue to monitor the evolving regulatory landscape regarding data center resource consumption, grid reliability, and environmental impact. We believe we are in material compliance with applicable environmental requirements, and our environmental compliance costs have not historically been material to our consolidated results. Insurance Where practical, we maintain insurance against risks associated with our operations in amounts we believe to be reasonable. Our insurance coverage contains customary exclusions and limitations, and there is no assurance that such insurance will continue to be available, will be available on acceptable terms, or will be adequate to cover all potential losses. Any uninsured or underinsured loss could have a material adverse effect on our business, financial condition, or results of operations. 12. Additional Information Additional information about us is available on our website at www.bitfarms.com, on the EDGAR website maintained by the SEC at www.sec.gov, and the SEDAR+ website maintained by the Canadian Securities Administrators at www.sedarplus.ca. The information on our website is not incorporated by reference in this Annual Report on Form 10-K. As of the date of filing, we are a “foreign private issuer” as defined in Rule 3b-4 under the Exchange Act. Although not required to do so, we have chosen to file annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K with the SEC. We will make available free of charge, through our website, annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. On or about April 1, 2026, we expect to complete our previously announced U.S. Redomiciliation. After the U.S. Redomiciliation, our website will be www.keelinfra.com. Keel Infrastructure Corp. is incorporated in Delaware and will be a U.S. domestic issuer. The estimated costs, timelines, and milestones described in this section are forward-looking statements and are subject to change based on numerous factors, including the cost and availability of equipment and materials, supply chain conditions, currency exchange rates, the availability of electricity at competitive rates, regulatory developments, the ability to secure customer contracts on acceptable terms, the availability of financing, and geopolitical events. See “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements and Risk Factors Summary.” Item 1.A. Risk Factors. An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this Annual Report, including our financial statements and related notes, before making a decision to invest in our securities. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business, financial condition and operating results. 9 Risks Related to our Business Our limited operating history makes it difficult to evaluate our business and prospects and increases the risk of your investment. We have a limited operating history upon which to base an evaluation of our business, prospects, and an investment in our Common Shares. We are subject to many risks common to venture enterprises, including under-capitalization, potential cash shortages and limitations with respect to personnel, financial and other resources. Although we have achieved profitable quarters in the past, to date, we have not maintained consistent profitability from period to period, and no assurances can be made that we will achieve consistent profitability in the near future, if ever. For the year ended December 31, 2025, we had a loss from continuing operations of $208.5 million. There is no assurance that we will be successful in achieving a return on shareholders’ investment or meeting other metrics of success, which is still dependent on Bitcoin prices and, in the future, the acquisition of customers for the Company’s HPC data centers, among other factors. Failure of critical systems related to our offerings and infrastructure could have a material adverse effect on our business, financial condition, and results of operations. Failure of critical systems related to our offerings and/or infrastructure could have a material adverse effect on our business, financial condition, and results of operations. The critical systems related to our offerings and infrastructure are subject to failure. Failure of any of our critical systems, including a breakdown in critical plant, equipment or services, routers, switches or other equipment, power supplies, or network connectivity, whether or not within our control, could result in service interruptions to us or our customers and/or damage to equipment, which could significantly disrupt the normal business operations of our customers, harm our reputation, and reduce our revenue. The destruction or severe impairment of any of the facilities operated by us could result in significant downtime. Our ability to attract and retain customers depends on our ability to provide a reliable service, so even minor interruptions in service could harm our reputation and negatively impact our business, financial condition, and results of operations. Our infrastructure and offerings are subject to temporary or permanent interruption by factors that include but are not limited to: ● power loss or plant downtimes; ● equipment failure; ● human error and accidents; ● theft, sabotage, and vandalism; ● failure by us or our suppliers to provide adequate service or maintain equipment; ● network connectivity downtime and fiber cuts; ● service interruptions resulting from server relocation; ● security breaches of infrastructure; ● improper or inadequate building maintenance; ● physical, electronic, and cybersecurity breaches; ● animal incursions; ● fire, earthquake, hurricane, tornado, flood, and other natural disasters; ● pandemics; ● extreme temperatures; ● water damage; ● public health emergencies; and ● terrorism. 10 The occurrence of any of these events may have a material adverse effect on our business, financial condition, and results of operations. Moreover, service interruptions and equipment failures may expose us to potential legal liability. As the services provided by us may be critical to our customers’ business operations, any disruption in services could result in lost profit or other indirect or consequential damages to our customers. Although customer contracts may contain provisions limiting our liability, there can be no assurance that a court would enforce any contractual limitations on our liability in the event that one of our customers brings a lawsuit against us as the result of a service interruption that they ascribe to us, or that a loss up to a contractually limited amount would still be a material loss to the Company. The outcome of any such lawsuit would depend on the specific facts of the case and any legal and policy considerations that we may not be able to mitigate. In such cases, we may be liable for substantial damage awards, which could have a material adverse effect on our business, financial condition, and results of operations. We have an evolving business model and strategy. We expect our business model to continue to evolve. As digital assets become more widely available and the number of applications of HPC and AI continues to expand and deepen across industries, we expect that our services and products will need to evolve in order to stay current with our industry. Our growth strategy includes exploring the expansion and diversification of our revenue sources into new markets. Pursuant to that strategy, we are currently conducting a strategic transformation which will reallocate our Infrastructure Assets into HPC Infrastructure, including the development of data centers which will be used for HPC and AI workloads. We believe the potential for HPC data centers complements our current business model with expected stable, long-term and high margin revenue. We also believe that using our existing Infrastructure Assets to develop HPC data centers provides more consistent dollar-based revenue and substantially less risk than our traditional Bitcoin Mining customers or our Bitcoin self-Mining operations. However, the success of our HPC data center services may not develop as anticipated, and may be affected by factors such as the reliability and timing of power supply, supply chain disruption (including local labor availability), the implementation of new tariffs and more restrictive trade regulations and changes in in-house specialized expertise to manage the business. A failure to successfully implement our HPC Infrastructure strategy may adversely affect our business, prospects, or operations. Our executive management team has limited or no experience in the digital infrastructure space, and we have expanded our team to include additional professionals, including external consultants, with such experience, but there is no guarantee that such efforts will be successful. Accordingly, we cannot offer any assurance that these or any other modifications to our business model and strategy will be successful or will not result in harm to our business. Such modifications may increase the complexity of our business and place significant strain on our management, personnel, operations, systems, technical performance, financial resources and internal financial control and reporting functions. In connection with our strategic transformation, we have exited or are in the process of exiting certain operations, including the abandonment of our operations in Argentina following a halt in the supply of electricity and the classification of our Paraguay operations as held for sale. These divestitures and wind-downs may result in impairment charges, residual liabilities, or losses that could adversely affect our financial condition and results of operations. Moreover, we may not be able to manage growth effectively, which could damage our reputation, limit our future growth and adversely affect our operating results. Further, we cannot provide any assurance that we will successfully identify emerging trends and growth opportunities within the HPC market or other markets we may seek to expand into, and we may lose out on such opportunities. Any of the foregoing could have a material adverse effect on our business, prospects, results of operations and financial condition. We may not be able to effectively manage our growth and expansion, which could damage our reputation, limit our future growth, and adversely affect our operating results. We have experienced, and may continue to experience, rapid growth in the scope of our operations. This growth has resulted in increased responsibilities for our existing personnel, the hiring of additional personnel and, in general, higher levels of operating expenses. In order to manage our current operations and any future growth effectively, we will need to continue to implement and improve our operational, internal controls, financial, and management information systems, as well as hire, manage and retain our employees and maintain our corporate culture including technical and operational service standards. There can be no assurance that we will be able to manage such growth effectively or that our management, personnel or systems will be adequate to support our operations. The Company’s expansion into HPC Infrastructure may divert resources from the Company’s Bitcoin Mining operations, limit the Company’s power capacity for Mining, and introduce operational complexity. Our focus on developing and offering HPC data centers may disrupt our Bitcoin Mining business, divert our resources, and require significant management attention that would otherwise be available for overseeing and developing our existing Bitcoin Mining operations business. While we intend to continue our Bitcoin Mining operations, the allocation of resources to support HPC data center development may reduce the capital, personnel, infrastructure and power capacity available for our Mining business. In particular, diverting future power capacity to HPC and AI workloads may limit our ability to deploy that power for Mining, which is a highly competitive and capital-intensive industry. As a result, we may be unable to expand our deployed hash rate (EH/s) at the pace of our competitors, potentially diminishing our market share and profitability. Managing multiple distinct lines of business may increase operational complexity and place additional demands on our management, technical, and support teams, which could negatively affect our overall performance, strategic execution and profitability. 11 Risks Related to our Operations Our operations are dependent on maintaining reliable and economical sources of power, and changes in regulated terms of service and electricity rates could have a material adverse effect on our business. Our operations are dependent on our ability to maintain reliable and economical sources of power. We conduct Mining operations and intend to develop HPC data centers in the Province of Québec and the United States (Washington and Pennsylvania). Our current and future operations and the sustainability of hydroelectricity and natural gas at economical prices poses certain risks. These risks as well as the supply of electrical power, electricity rates, terms of service and regulatory regimes are summarized as follows: Currently, we source our energy from Hydro-Québec; Hydro-Sherbrooke; Hydro-Magog; the city of Baie-Comeau; Grant PUD; and PJM Interconnection Merchant Market. We also generate our own energy through our two refuse power plants in Pennsylvania, United States. Regulated power suppliers may be subject to public policy initiatives and economic development programs which may or may not support the Bitcoin Mining or HPC and AI industries. There can be no assurance that electricity will continue to be provided in the future or not curtailed to accommodate other users, or otherwise made available on terms which are economic for our current and future operations, anticipated growth, and sustainability. Any suspension or cessation of power supply, failure of electrical networks, or changes in cost structure which are not economic, in the jurisdictions where we utilize power for our operations, could result in a material adverse effect on us. Québec Our operations are dependent on our ability to maintain reliable and economical sources of power. Until the adoption of Bill-2, on February 15, 2023, the Province of Québec mandated electrical service providers to supply their customers under the obligation to serve power delivery regime; however, Bill-2 amended the Act respecting the Régie de l’Energie du Québec (the “Régie”) by giving the Government of Québec the power to determine by regulation the cases in which Hydro-Québec, or any other electrical service provider, may be exempt from their obligation to provide electricity to industrial clients in the Province of Québec. The price of electricity supplied directly by Hydro-Québec is set by the Régie, a provincial administrative tribunal. Hydro-Québec supplies power to certain of our facilities, and to the Municipal Electrical Networks for the Magog, Baie-Comeau and Sherbrooke facilities. The rates imposed on Hydro-Québec by the Régie are subject to change. Although power is supplied to us by Municipal Networks, the rates in those contracts are adjusted in response to tariff changes imposed by the Régie. Modifications to the rates are set pursuant to the Act respecting the Régie based on the costs of service. There is no assurance that future electricity rates will remain stable or economical. Historically, electricity supplied by Hydro-Québec and the Municipal Electrical Networks could be set at preferential rates in an effort to encourage investment and development in particular regions. Hydro-Québec and Municipal Electrical Networks were able to offer a discretionary preferential rate to certain customers, such rate being lower than the rate set by the Régie, notwithstanding that Hydro-Québec and the Municipal Electric Networks may suffer a financial loss on the supply of electricity to those customers. Currently, the Cowansville Facility is subject to a preferential rate of 5% on its first 5 MW of power; and the Farnham Facility is subject to a preferential rate of 20% on its first 10 MW of power. In September 2023, the Régie approved a request from Hydro-Québec to remove the option to accept new request for preferential rates submitted by industrial clients. Hydro-Québec confirmed that it will honor its contractual obligations, but no new request will be accepted. When a preferential rate will no longer be available to us, our operations and profitability may experience a material adverse effect. In addition, although power is supplied by the Municipal Networks to us under the power contracts, the rates in those contracts are adjusted in response to tariff changes imposed by the Régie. Recently, the regulatory environment in Québec has become significantly more hostile to the cryptocurrency Mining industry. On February 18, 2026, the Government of Québec published Decree 88-2026, instructing the Régie to treat cryptocurrency Mining as having lower strategic and economic value than traditional data centers, and directing that the applicable tariff (“Tarif CB”) be increased to match the current punitive tariff rate. The following day, Hydro-Québec filed a request to modify the Tarif CB, proposing drastic price increases, including a 166% to 193% increase in the power demand charge and up to a 199% increase in energy consumption rates. 12 On March 17, 2026, we, along with another industry participant, filed a petition for judicial review in the Superior Court of Québec seeking to nullify Decree 88-2026. We assert that the decree is ultra vires, improperly interferes with the Régie’s exclusive jurisdiction over rate-setting, and relies on illegal ulterior motives intended to drive the cryptocurrency Mining industry out of the province. We are vigorously contesting this decree; however, if we are unsuccessful and the proposed tariff increases are implemented, cryptocurrency Mining operations in Québec will become economically unviable, which would have a material adverse effect on our business, financial condition, and results of operations. Washington State On November 9, 2021, we completed the acquisition of a Bitcoin Mining facility in Washington state. The facility is powered by the Grant County Power Utility District (“Grant PUD”). Grant PUD was established in 1938 and is a public utility district that owns and operates hydro-electric plants capable of generating more than 2,000 MW of electricity. Grant PUD establishes rate schedules for different categories of customers at the discretion of its publicly elected Board of Commissioners. We operate our Bitcoin Mining activities in several different buildings with their own power meters not exceeding 5 MW each; thus, for the year 2022, we were classified in Schedule 7. The applicable rates for Schedule 7 are a demand charge of $4.96 per KW of billing demand plus a variable component of 2.100¢ per kWh for the first 50,000 kWh of consumption and 1.857¢ per additional kWh of consumption. Historically, rates for Schedule 7 have increased by an annual average of 1.27% per year. Effective February 1, 2023, Grant PUD’s commissioners authorized the addition of cryptocurrency Mining into the Evolving Industry Rate Schedule 17 (“Schedule 17”). The applicable rates for Schedule 17 are a demand charge of $28.18 per kW plus a variable component of $0.389 per kWh of consumption. Grant PUD may adjust the rate pricing with approval from its Board of Commissioners. An increase in the rates applicable to our electricity consumption in our operations in Washington state may adversely impact our profitability. On November 19, 2025, Grant PUD proposed annual rate increases between 7.8% and 12.0% over each of the next 10 years for Schedule 17. On January 27, 2026, Grant PUD commissioners unanimously approved a 10.6% rate increase for Schedule 17 as part of the 2026 rate package. This increase will take effect on April 1, 2026. Pennsylvania In June 2024, we executed a lease agreement for a site located in Sharon, Pennsylvania, United States (“Sharon Lease Agreement”), and develop up to 110 MW of power capacity. In August 2024, we finalized the definitive lease agreement and assumed control of the property. With this transaction, we acquired a potential 110 MW of electricity capacity, with the transaction providing we with an immediate capacity increase of 12 MW of electricity. In January 2025, we energized 12 MW at the Sharon Bitcoin data center. In May 2025, we energized an incremental 18 MW expansion project, bringing the total energized capacity to 30 MW. The remaining 80 MW is slated to come online by the end of 2026, when the installation of electrical infrastructure is expected to be completed. In November 2025, we purchased the Sharon facility from the landlord. In May 2025, we were registered for PJM’s Peak Saver and Synchronized Reserves Dispatchable Programs. In August 2025 we initiated our customer base load baseline qualification run, and in November we successfully passed PJM’s baseline requirements for registration in the Price Response (Economic Demand Response) Dispatchable Program and is currently participating in this program with PJM through its Curtailment Service Provider (“CSP”). Participation in these programs enables both demand response and energy arbitrage strategies that we have been developing since January 2025 which, including hedging strategies designed to manage price volatility risk and enable tailored arbitrage strategies through PJM’s programs across its PJM portfolio. These programs are anticipated to contribute to maximizing the value of its PJM assets through more effective control of energy prices and will be accretive to our flexible HPC data center strategy currently under development in PJM. PJM is the largest U.S. regional transmission organization (“RTO”) overseeing the electricity grid and wholesale markets across 13 states and D.C. Its market dynamics are characterized by tightening capacity, rising capacity prices, and growing exposure to both policy and interconnection risks that can materially affect power price outcomes over the next decade. PJM is comprised of three separate but related markets: the energy market (day-ahead and real-time), the capacity market (under the Reliability Pricing Model, or RPM), and ancillary service markets. In the energy market, pricing is competitive but has been increasing in the last 12-24 months, largely due to fuel cost increases, transmission congestion, and tighter reserve margins, with locational marginal prices (LMPs) increasingly being shaped by congestion and transmission constraints. These constraints, when binding, can create pricing spikes that are managed through either hedging or cost avoidance load shedding to maintain margins. In the capacity market, recent RPM auctions have been settling at approximately an order or magnitude higher than they have been historically, putting upward pressure on all-in power pricing as capacity charges become a larger portion of the overall power bill. Given where recent auctions have settled and a persistently thin RTO-wide reserve margin, it is unlikely that capacity pricing will normalize over the near- to medium-term. From a regulatory perspective, the rapid growth in data center interconnection requests and planned data center load growth throughout much of PJM has led to several proposed changes that could affect us, including jurisdictional disputes between FERC, state governments, and local utilities, and several utility-specific data center tariff proposals. Although none of these regulatory changes has yet come into effect in their proposed form and are not believed to pose material risk to us, we monitor them closely for any potential negative impact. 13 Increases in commodity prices or reductions in the availability of commodities we use in our operations could increase our operating costs and reduce our profitability. We use and intend to continue using certain commodities in our current and future Bitcoin Mining and HPC Infrastructure operations, including hydro-electricity. Unexpected, sudden or prolonged price increases in those commodities, whether as a result of geopolitical events, natural disasters or otherwise, have caused and, in the future, may cause a reduction in our profits where beneficial fixed-priced contracts do not exist or unfavorable fixed-price contracts cannot be modified. There also may be curtailment in electricity or natural gas supply. In particular, the recent U.S. military operations in Iran and the Iranian response and the Russia-Ukraine conflict have had an inflationary effect on the cost of natural gas, the duration and future magnitude of which are difficult to predict given the fluidity of the military conflict, the novelty of sanctions against Russia and the possibility of yet harsher sanctions as well as other related developments. The realization or continuation of any of the foregoing risks with respect to commodity prices could increase our operating costs, reduce our profitability and, depending upon the duration and extent of the impact, have a material adverse effect on our financial condition. Our operations are subject to hazards associated with power generation, high-voltage electricity transmission, and industrial operations that could result in significant personal injury, property damage, and liability. Our operations are subject to typical hazards associated with power generation, high-voltage electricity transmission and the supply of utilities to our Miners and data centers at an industrial scale. In particular, power generation involves hazardous activities, including acquiring, transporting and unloading fuel and operating large pieces of equipment. In addition to natural risks such as earthquakes, floods, lightning, hurricanes and wind, other human-made hazards, such as nuclear accidents, dam failure, gas or other explosions, mine area collapses, fire, structural collapse, machinery failure and other dangerous incidents are inherent risks in our operations. These and other hazards can cause significant personal injury or loss of life, severe damage to and destruction of property, plant, equipment, and transmission lines, contamination of, or damage to, the environment and suspension of operations. Further, our employees and contractors work in, and the general public may be exposed to, potentially dangerous environments at or near certain of our operations. As a result, employees, contractors, and the general public are at risk for serious injury, including loss of life. The occurrence of any one of these events may result in us being named as a defendant in lawsuits asserting claims for substantial damages, including for environmental cleanup costs, personal injury and property damage and fines and/or penalties. We maintain an amount of insurance protection that we considers adequate, but we cannot provide any assurance that our insurance will be sufficient or effective under all circumstances and against all hazards or liabilities to which we may be subject and, even if we do have insurance coverage for a particular circumstance, we may be subject to a large deductible and maximum cap. A successful claim for which we are not fully insured could hurt our financial results and materially harm our financial condition. Further, due to rising insurance costs and changes in the insurance markets, we cannot provide any assurance that our insurance coverage will continue to be available at all or at rates or on terms similar to those presently available. Any losses not covered by insurance could have a material adverse effect on our financial condition, results of operations or cash flows. 14 Our reliance on a limited number of third-party suppliers exposes us to supply chain disruptions that could adversely affect our operations. We enter into contracts with a limited number of third-party suppliers in connection with our Mining operations and our transition to HPC Infrastructure. If any of those suppliers is unable to or otherwise does not fulfill, or does not fulfill in a timely manner, its obligations to us for any reason (including, but not limited to, bankruptcy, computer or other technological interruptions or failures, personnel loss, negative regulatory actions, or acts of God) or engages in fraud or other misconduct during the course of such relationship, we may need to seek alternative third-party suppliers, or discontinue using certain software or hardware or otherwise alter our operations and may encounter delays. In addition, we may in the future be held directly or indirectly responsible, or be otherwise subject to liability, for actions or omissions of third parties undertaken in connection with our arrangements with such third parties. Any such responsibility or liability in the future may have a material adverse effect on our business, financial condition and results of operations. Our reliance on third-party manufacturers in foreign jurisdictions and the importation of equipment exposes us to trade, tariff, and geopolitical risks that could adversely affect our business. We rely on third-party manufacturers in foreign jurisdictions for our Miners and for equipment and materials used in our HPC data center operations, including GPUs, generators, steel and copper. As a result, our business is subject to risks associated with doing business in such foreign jurisdictions, including, but not limited to: trade protection measures such as the imposition of or increase in tariffs, import and export licensing and control requirements; potentially negative consequences from changes in tax laws (both foreign and domestic); difficulties associated with transacting business with parties in a foreign jurisdiction, including increased costs and uncertainties associated with enforcing contractual obligations; and unexpected or unfavorable changes in other regulations and applicable regulatory requirements. The U.S. has previously enacted and has proposed to enact new tariffs (or increases of existing tariffs) on certain items imported from other countries. Following their enactment, the tariffs sparked an international trade war in which other countries enacted tariffs on imports of U.S. goods. Subsequently, the U.S. and various countries subject to those tariffs have engaged in trade negotiations and, in some instances, agreed to suspend or terminate certain tariffs. It is uncertain whether treaties or other trade policies like those will be enacted or modified by the U.S. or any other government or trade organization in the future. In addition, we may be subject to retroactive customs duty determinations or reclassifications with respect to previously imported equipment, which could result in material unexpected costs. Future changes to trade or investment policies, treaties and tariffs, fluctuations in exchange rates, or the perception that these changes could occur may adversely affect third-party manufacturers on which we rely, as well as the future of our relationships with those third-party manufacturers, which could have an adverse impact on our business, financial condition and results of operations. In addition, actions by foreign markets to implement further trade policy changes, including limiting foreign investment or trade, increasing regulatory scrutiny or taking other actions that apply to the jurisdictions in which we operate or in which third parties with which we do business operate, could negatively impact our business, financial condition and results of operations. Technological obsolescence and difficulty in obtaining hardware could require substantial capital investments and adversely affect our competitive position. To remain competitive, we will continue to monitor the state of available technology and invest in hardware and equipment required for maintaining and, as applicable, enhancing our operations. This is true for both Bitcoin Mining and HPC data center operations. We have in the past replaced, and, in the future, may be required to replace, obsolete hardware and software, which required, and, in the future, may require, substantial capital investments by us. There can be no assurance that hardware will be readily available, whether at a price that is commercially acceptable to us or at all, when the need is identified. Moreover, there can be no assurance that new and unforeseeable technology, either hardware-based or software-based, will not disrupt the industries in which we operate. 15 The continued development of our existing and planned facilities is subject to risks that may cause delays or increased costs and could adversely affect our operations. The continued development of existing and planned facilities, such as the conversion of Moses Lake and our other sites into HPC data centers, is subject to risks that may cause such development plans to be delayed or otherwise adversely affected, including factors beyond our control such as delays in the delivery or installation of equipment by suppliers, difficulties in integrating new equipment into existing infrastructure, shortages in materials or labor, defects in design or construction, diversion of management resources, insufficient funding, or other resource constraints. Actual costs for development may also exceed our planned budget. Delays, cost overruns, changes in market circumstances and other factors may result in different outcomes than those intended. If any development projects are delayed or more expensive than contemplated, our operations may be adversely impacted, and we may not realize, or may be delayed in realizing, the benefits of such projects. Community opposition to the operation of our data centers could result in risks to our operations and our financial condition and results of operations. Our Mining operations and planned HPC data centers involve the use of a large number of high-powered Miners and computers (as applicable) as well as support systems that generate noise and can use significant amounts of electricity and water. This noise and resource use can pose several risks to our business including community complaints, reputational damage, litigation risk, regulatory risk, operational constraints, increased costs and opposition to expansion. These risks could lead to fines or penalties imposed by local governments, requirements to implement costly noise mitigation measures or restrictions on the use of electricity, restrictions on our operating hours, reduction of scale of our operations, stricter noise controls regulations on our operations, potential shutdown of data centers that cannot meet local noise regulations or face extensive community opposition due to the data centers’ use of electricity, damages resulting from lawsuits and difficulty obtaining necessary permits and approvals for expanding existing data centers or establishing new site operations. While we strive to be a good corporate citizen and mitigate noise impacts and any alleged impacts of electricity and water usage where possible, the inherently noisy and energy-intensive nature of large-scale Bitcoin Mining operations and HPC data centers presents ongoing risks to our business that may negatively affect our financial condition and results of operations. Our insurance coverage may be inadequate to cover all potential losses, which could adversely affect our financial condition and results of operations. Where considered practical to do so, we intend to maintain insurance against risks in the operation of our business and in amounts that we believe to be reasonable. Such insurance, however, contains, and may in the future contain, exclusions and limitations on coverage. There can be no assurance that such insurance will continue to be available, will be available at economically acceptable premiums or will be adequate to cover any resulting liability. The novelty of the Bitcoin industry has impaired and may continue to impair our ability to acquire adequate insurance coverage for risks associated with our operations. The occurrence of an event that is not covered, in full or in part, by insurance may cause us substantial economic damage. In some cases, such as with respect to environmental risks, coverage is not available or considered by management to be too expensive relative to the perceived risk. It is expected there would be limited legal recourse in the event of a loss of Bitcoin. Our Bitcoin, which is held in custody by Coinbase Custody and Anchorage Digital, is not fully insured. Although Coinbase Custody maintains an insurance policy of $320 million for its cold storage and Anchorage Digital maintains an insurance policy of $50 million for its cold and hot storage, the full limits of those policies may not be available to us or, if available, sufficient to make us whole for any Bitcoin that are lost or stolen from its account. Therefore, a loss may be suffered with respect to our Bitcoin that is not covered by insurance and for which no person is liable for damages. Further, we do not hold our Bitcoin with a banking institution or a member of the Federal Deposit Insurance Corporation (“FDIC”) or the Securities Investor Protection Corporation (“SIPC”) and, therefore, our Bitcoin is not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions. Any losses incurred by us that are not adequately covered by insurance or for which insurance coverage is not available or has not been obtained could adversely impact us, including our financial condition and results of operations. 16 Our owned and leased properties, including our Infrastructure Assets and our Bitcoin Mining sites, are subject to a range of risks associated with their physical condition and ongoing operations. These risks include, but are not limited to: defects in construction or repair, structural or building damage, noncompliance with or liabilities under applicable environmental, health, or safety laws and regulations, and failure to meet building permit or zoning requirements. Our facilities may also be exposed to damage resulting from natural disasters and the effects of climate change, such as fire, earthquake, hurricane, tornado, flood, extreme temperatures, and other severe weather events, as well as risks arising from vandalism, theft, sabotage, animal incursions, and terrorism. Additionally, we may face claims from employees, contractors, or third parties for injuries or damages sustained at our sites. While we maintain insurance coverage with leading providers and implement security measures and operational protocols consistent with industry standards for HPC and data center infrastructure, there can be no assurance that such insurance will be adequate to cover all potential losses or that coverage will continue to be available on commercially reasonable terms. Certain events, including catastrophic losses or damages not covered by insurance, could result in significant downtime, disruption of operations, or material adverse effects on our business, financial condition, and results of operations. We operate in intensely competitive industries, and increased competition could erode our market share and adversely impact our profitability. Our business is in intensely competitive industries, and we compete with other Bitcoin Mining companies in our legacy segment, as well as with established and emerging HPC data center operators in our primary growth segment, some of which have, or may in the future have, greater resources and experience. A fundamental property of Bitcoin Mining is that the computational complexity of the Mining algorithm increases over time. This factor, along with new industry entrants, price volatility and, with respect to Bitcoin, any future Bitcoin Halvings, may make certain cryptocurrencies relatively unprofitable to mine compared to others. Despite our strategic planning and expected advantages over certain of our competitors, we may face unexpected competition in the form of new entrants in the marketplace. Such competition could erode our expected market share and could adversely impact our profitability. Increased competition in the Bitcoin Mining industry could result in increased network computing resources and consequently increased hash difficulty. Additionally, we may compete with other companies in the power generation industry. New parties may offer wholesale electricity bundled with other products or at prices that are below our rates. Other companies with which we compete in power generation may have greater liquidity, greater access to credit and other financial resources, lower cost structures, more effective risk management policies and procedures, greater ability to incur losses or greater flexibility in the timing of their sale of generation capacity and ancillary services than we do. Competitors may also have better access to subsidies or other out-of-market payments that put us at a competitive disadvantage. We also compete for access to energy-advantaged land positions, grid interconnections, engineering and operational talent, and customers seeking scalable, energy-efficient data center capacity for HPC and AI workloads. Our competitors in the power generation industry may be able to respond more quickly to new laws or regulations or emerging technologies, or to devote greater resources to marketing of wholesale power than we can. In addition, current and potential competitors may make strategic acquisitions or establish cooperative relationships among themselves or with third parties. Accordingly, it is possible that new competitors or alliances among current and new competitors may emerge and rapidly gain significant market share. There can be no assurance that we will be able to compete successfully against current and future competitors in the power generation industry, and any failure to do so would have a material adverse effect on our business, financial condition, results of operations and cash flow. Our inability to attract and retain key employees and qualified personnel could adversely affect our business, financial condition, and prospects. Loss of our key employees, or an inability to attract and retain such management and other personnel, could negatively affect our business. We depend on a number of key employees including, in particular, the members of our management, the departure, death, disability or other extended loss of services of any of whom, particularly with little or no notice, could cause delays on projects, frustrate our growth prospects and have an adverse impact on our industry relationships, project exploration and development programs, other aspects of our business and our financial condition, results of operations, cash flow and prospects. We have not historically purchased, and, in the future, do not expect to purchase, key person insurance on such individuals, which insurance would provide us with insurance proceeds in the event of their death. 17 The growth and development of our business also depends on our ability to attract and retain highly qualified management and personnel while maintaining our corporate culture and technical standards. We face competition for personnel from other employers. If we are unable to attract or retain qualified personnel as required, we may not be able to adequately manage and implement our business plan. There can be no assurance that we will be able to manage such growth effectively or that our Management, personnel or systems will be adequate to support our operations. We sell capacity, energy, and ancillary services to the wholesale power grid managed by PJM. Our business may be affected by state interference in the competitive wholesale marketplace. We sell capacity, energy, and ancillary services to the wholesale power grid managed by PJM. The competitive wholesale marketplace may be impacted by out-of-market subsidies provided by states or state entities, including bailouts of uneconomic electric power generating plants, imports of power from Canada, renewable mandates or subsidies, mandates to sell power below its cost of acquisition and associated costs, as well as out-of-market payments to new or existing generators. These out-of-market subsidies to existing or new generation undermine the competitive wholesale marketplace, which can lead to premature retirement of existing facilities, including those owned by us. If these measures continue, capacity and energy prices may be suppressed, and we may not be successful in our efforts to insulate the competitive market from this interference. Our wholesale power revenue may be materially impacted by rules or regulations that allow regulated utilities to participate in competitive wholesale markets or to own and operate rate-regulated facilities that provide capacity, energy and ancillary services that could be provided by competitive market participants. Risks Related to HPC Infrastructure Operations The Company’s increased focus on developing data centers for HPC and AI workloads may not become profitable in the future and may result in adverse consequences to the Company’s business, results of operations and financial condition. We are subject to risks and uncertainties of starting a new business, including the risk that we may never further develop or complete development of our proposed HPC data center business. Although our construction and operations teams have prior experience in the HPC Infrastructure field and we believe focusing on developing data centers for HPC companies will be beneficial to our shareholders, the HPC data center business is rapidly evolving. We have limited experience in developing an HPC Infrastructure business and we have not previously constructed and operated an HPC data center, which may impact our efforts and our ability to accurately assess our prospects; thus, there is no guarantee that we will successfully implement our development plans or that this business will become profitable in the future. Furthermore, we may experience difficulties with infrastructure development or modification, engineering, or design, which could result in excessive capital expenditures and significant delays. For example, we are designing our HPC data centers to support NVIDIA’s next-generation Vera Rubin GPUs. Vera Rubin GPUs require specifically designed facilities with certain power and cooling requirements. However, Vera Rubin GPUs have not yet been shipped to purchasers, and there can be no assurance that the design of our facilities will support the efficient operation of Vera Rubin GPUs to the extent anticipated by us, or at all. Our efforts to construct and operate HPC data centers may prove more expensive than we currently anticipate and may not result in increased revenue or profitability in the short term or at all. 18 The likelihood of our success must be considered in light of the expenses, difficulties, complications, problems and delays frequently encountered in connection with the expansion of a business and operating a business in an industry that is novel, competitive and rapidly evolving. There can be no assurance that we will ever operate HPC data centers profitably and it may be possible that a continued focus on operating Bitcoin Mining data centers would have been more profitable. Our business expansion into HPC Infrastructure may be capital intensive and could affect our liquidity, results of operations and financial condition. Our expansion into HPC Infrastructure is expected to increase capital intensity and shift the timing of cash inflows relative to capital outlays. Developing and constructing data center campuses requires substantial up-front capital expenditures for land, substations, interconnection and specialized cooling systems, which may temporarily reduce liquidity. This business expansion introduces uncertainties that could impact our liquidity and capital resources. Increased capital expenditure requirements for new HPC data centers may accelerate cash deployment and increase short-term liquidity needs. The timing of cash inflows may shift, as hosting and leasing revenues generally materialize after construction completion and customer onboarding, resulting in a lag between capital investment and revenue realization. Although our Bitcoin-backed liquidity and treasury activities provide flexibility, we may need to seek additional financing, through debt, equity, or infrastructure-oriented funding, to meet project-scale capital demands or to preserve Bitcoin holdings during periods of market volatility. Constructing HPC data centers requires significantly higher capital expenditures compared to Bitcoin Mining facilities, and we may be unable to secure capital or financing for our construction efforts to develop HPC data centers. Constructing HPC data centers requires significant capital expenditures, in particular when compared to capital expenditures for Bitcoin Mining facilities. If we are not able to secure capital or financing to fund our construction efforts with respect to HPC data centers, the completion of such projects may be delayed and our ability to collect any potential rental revenue or to otherwise monetize such facilities may be compromised, which could have an adverse effect on our expansion strategy and our ability to generate significant or any revenue from an HPC data center business. 19 Significant competition for suitable data center sites and regulatory constraints could adversely impact our development pipeline, expansion strategy, and results of operations. There is significant competition for suitable data center sites, particularly in supply-constrained geographies with access to reliable, low-cost power and robust fiber connectivity. Our ability to leverage our portfolio of secured and contracted sites may be impacted by factors outside our control, including regulatory or permitting delays, community opposition, or changes in local land use or environmental regulations. Securing agreements for power interconnection, and obtaining the necessary permits, approvals, and licenses to construct and operate data centers, may be delayed, denied, or become cost prohibitive due to regulatory processes or evolving policy priorities. Governmental actions, including the introduction of new regulations or restrictions on HPC data centers, or digital asset Mining operations, may reduce the availability of electricity, increase its cost, or otherwise adversely affect our business and development pipeline. In addition, development and construction delays, cost overruns, changes in market dynamics, environmental or community constraints, and the inability to continue securing suitable data center locations may adversely impact our operations, expansion strategy, financial condition, and results of operations. We depend on significant customers for our HPC data centers. Many factors, including global economic conditions, may cause our HPC data center customers to experience a downturn in their businesses or otherwise experience a lack of liquidity, which may weaken their financial condition and impact our estimates as to the probability of collectability of payments, and ultimately result in their failure to make timely rental and other payments or their default under their agreements with us. Further, the development of new technologies, the adoption of new industry standards or other factors could render our HPC data center customers’ current products and services obsolete or unmarketable and contribute to a downturn in their businesses, thereby increasing the likelihood that they default under their leases, become insolvent or file for bankruptcy. If a customer defaults or fails to make timely rent or other payments, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment, which could adversely affect our financial condition and results of operations. If a customer becomes a debtor in a case under the U.S. Bankruptcy Code, we cannot evict the customer solely because of the bankruptcy. In addition, the bankruptcy court might authorize the customer to reject and terminate its contracts with us. Our claim against the customer for unpaid, future rent and other payments would be subject to a statutory cap that might be substantially less than the remaining amounts actually owed under their agreements with us. In either case, our claim for unpaid rent and other amounts would likely not be paid in full. Our revenue could be materially adversely affected if a significant customer were to become bankrupt or insolvent, suffer a downturn in its businesses, fail to renew its contract or renew on terms less favorable to us than its current terms. 20 Our contracts with HPC data center customers could subject us to significant liability. In the ordinary course of business, we aim to continuously enter into agreements with customers pursuant to which we provide data center space, power, environmental controls, physical security and connectivity products to our HPC data center customers. These contracts typically contain indemnification and liability provisions, in addition to service level commitments, which could potentially impose a significant cost on us in the event of losses arising out of certain breaches of such agreements, services to be provided by us or our subcontractors or from third-party claims. HPC data center customers increasingly are looking to pass through their regulatory obligations and other liabilities to their outsourced data center providers and we may not be able to limit our liability or damages in an event of loss suffered by such customers whether as a result of our breach of an agreement or otherwise. If such an event of loss occurred, we could be liable for material monetary damages and could incur significant legal fees in defending against such an action, which could adversely affect our financial condition and results of operations. We may also develop space specifically for HPC data center customers pursuant to agreements signed prior to beginning or early in the development process. In those cases, if we fail to meet our development obligations under those agreements, these customers may be able to terminate their agreements and we would be required to find a new customer for this space. In addition, in certain circumstances we may lease HPC data center facilities prior to their completion. If we fail to complete the facilities in a timely manner, the customer may be entitled to terminate its agreement, seek damages or penalties against us or pursue other remedies and we may be required to find a new customer for the space. If we are not able to complete an HPC data center in a timely manner, if development costs are higher than we currently estimate, our financial condition, results of operations and cash flow could be materially adversely affected. Additionally, a customer’s decision to lease space and power in our HPC data center typically involves a significant commitment of resources and due diligence on the part of our customers regarding the adequacy of our facilities. As a result, we may expend significant time and resources in pursuing a particular transaction that may not result in revenue. Economic conditions, including market downturns and the implementation of new tariffs and more restrictive trade regulations may impact customers’ ability to plan future business activities, which could cause customers to slow spending or delay decision-making. Our inability to adequately manage the risks associated with these developments may adversely affect our business, financial condition and results of operations. Certain of our agreements with HPC data center customers may include restrictions on providing HPC data center services to certain third parties, which could have a material adverse effect on us. Certain of our customer agreements may prohibit us from providing HPC data center services to certain third parties, including competitors of existing HPC data center customers. The existence of such restrictions could hinder our ability to enter into agreements with additional HPC data center customers, which could have a material adverse affect our business, financial condition and results of operations. 21 The development and advancement in the efficiency of HPC and AI models presents risks and challenges that may adversely impact our business and operating results. The introduction of, and advancement in the efficiency of HPC and AI models could potentially adversely affect data center usage by significantly reducing the computational power needed to train HPC and AI models, potentially leading to less demand for high-power density, liquid-cooled data center infrastructure and colocation facilities. New advancements in HPC and AI models could also alter the way data centers are currently designed and utilized and may adversely affect our business and results of operations. Risks Related to Bitcoin Periodic Bitcoin halving events reduce Mining rewards and could render our Mining operations unprofitable for sustained periods, which could have a material adverse effect on our business. The Bitcoin reward for solving a block is subject to periodic incremental halving. Halving is a process designed to control the overall supply and reduce the risk of inflation in Bitcoin using a proof of work consensus algorithm. At a predetermined block, the Mining reward is cut in half, hence the term “halving”. The Bitcoin blockchain has undergone halvings four times since its inception. Most recently, in April 2024, the Bitcoin Block Reward decreased from 6.25 to 3.125 Bitcoin per block, a Bitcoin Halving, and, consequently, the number of new Bitcoin issued to Miners as a subsidy decreased to approximately 450 per day, excluding transaction fees. The April 24, 2024, Bitcoin Halving had a significant negative impact on our profitability for several months following the Bitcoin Halving. It took approximately six months for our revenue per teraHash to return to the level experienced prior to the recent Bitcoin Halving. Given that profitability is required for self-acting agents to perform Mining to continue to support the validation of transactions, the expected impact of the Bitcoin Halving is that market variables of Bitcoin price will adjust over time to ensure that Mining remains profitable. The period of market normalization after the next Bitcoin Halving to incentivize profitability levels is unknown. A Bitcoin Halving is scheduled to occur once every 210,000 blocks, or roughly every four years, until the total amount of Bitcoin rewards issued reaches 21 million, which is expected to occur around the year 2140. Once 21 million Bitcoin are generated, the network will stop producing more. The next Bitcoin Halving is expected to occur in 2028, at which time Bitcoin Block Rewards will decrease from 3.125 Bitcoin per block to 1.5625 Bitcoin per block. While Bitcoin prices have had a history of price fluctuations around Bitcoin Halving events, there is no guarantee that the price change will be favorable or would compensate for the reduction in Mining reward and the corresponding decrease in the compensation we receive from the Mining Pool(s) in which we participate. If Bitcoin price and difficulty do not maintain or continue their trend of adjusting to pre-Bitcoin Halving profitability levels over time, or the period of market normalization after the Bitcoin Halving to pre-Bitcoin Halving profitability levels is too long, there is a risk that a future Bitcoin Halving will render us unprofitable. Our reliance on a single third-party Mining Pool operator subjects us to concentration risk that could have a material adverse effect on our operations. We participate in a single Mining Pool, being the Foundry Pool. Consequently, our operations are substantially reliant on Foundry Pool and the terms of services and other terms and conditions that govern its relationship with Foundry Pool. Foundry Pool has the right to unilaterally modify the service agreement between it and us at any time without notice. This includes the right to modify the payout methodology or Mining Pool fees. 22 Pursuant to the terms and conditions of Foundry Pool, we have also agreed to release, indemnify and hold Foundry Pool harmless from any and all losses, damages, expenses, including reasonable attorneys’ fees, rights, claims, actions of any kind and injury (including death) arising out of or relating to our participation in Foundry Pool. In the event of any such losses, damages, or expenses, we may experience an adverse impact on our business, results of operations and financial condition. In the event that Foundry Pool (or any other Mining Pool in which we participate) ceases making payments to us for any reason, including bankruptcy, insolvency or cessation of its operations, or for no reason, or modifies its payout methodology or Mining Pool fees or any other terms in a manner that is unattractive or unacceptable to us, we would expect to immediately cease contributing our Hash power to such Mining Pool operator and either: (i) join a different Mining Pool operator (or our back-up Mining Pool); or (iii) commence Mining without a Mining Pool operator. In the event that we are unable to make such a switch of our operations in a timely manner and our Mining operations experience significant down time, we may experience an adverse impact on our business, results of operations and financial condition. As a control measure, on a monthly basis, we calculate the revenues we should earn based on our theoretical Hashrate and compare it to the payments we received from Foundry Pool. As of the date hereof, we have not identified any material discrepancies between our calculations and payments actually received from Foundry Pool. In the event that we identify a material difference, we may have to engage in litigation and/or cease our relationship with Foundry Pool, either of which may have a material adverse effect on us. Our third-party hosting agreements expose us to counter-party and operational risks that could have a material adverse effect on our business. We are currently party to, and may in the future, enter additional third-party hosting agreements. Under such agreements, the performance and physical security of our Miners are reliant on such hosting providers. Although hosting providers are contractually obligated to perform to industry standards, any failure on the part of a hosting provider will subject our operations to risks which may have a material adverse effect. Additionally, hosting providers may be subject to curtailment of power supplies or other restrictive regulation at the discretion of applicable regulators, which is beyond our control and that of the hosting provider. The limited history of the decentralized financial system and the susceptibility of cryptocurrency exchanges to fraud and failure could adversely affect our business and the value of our Bitcoin holdings. Compared to traditional and existing centralized financial systems, the Bitcoin financial system is relatively new and has a limited history. Online cryptocurrency exchanges and trades therein operate with comparatively little regulation and are particularly susceptible to platform failures and fraudulent activities, which may have an adverse effect on the underlying prices of cryptocurrencies. As a result, we may now or in the future have investments in certain cryptocurrency platforms that become insolvent. In fact, many of the largest online cryptocurrency exchanges have been compromised by hackers. Considering these and other factors, traditional banks and other banking institutions may limit or refuse the provision of banking services to businesses that supply cryptocurrencies as payment and may refuse to accept money derived from cryptocurrency-related businesses. This may make the establishment and management of bank accounts held by companies operating in the industry difficult or impossible. We have experienced and may in the future experience such banking challenges, which could have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoin we earn or otherwise acquire or hold for our own account. The Company’s Bitcoin holdings could subject the Company to regulatory scrutiny and potential restrictions on future transactions. The characteristics of Bitcoin have been, and may in the future continue to be, exploited to facilitate illegal activity such as fraud, money laundering, tax evasion, and ransomware scams. Furthermore, the exchanges on which Bitcoin trades are relatively new and, in most cases, largely unregulated and may therefore be more exposed to fraud and failure than established, regulated exchanges for other assets. Such circumstances may result in a reduction in the price of Bitcoin and can adversely affect our business, financial condition, and results of operations. 23 Bitcoin and the exchanges on which Bitcoin trades are relatively new and, in most cases, largely unregulated. Certain characteristics, including the speed with which Bitcoin transactions can be conducted, the ability to conduct transactions without the involvement of regulated intermediaries, the ability to engage in transactions across multiple jurisdictions, the irreversible nature of certain Bitcoin transactions, and encryption technology that anonymizes these transactions make Bitcoin, and digital currencies generally, particularly susceptible to use in illegal activity such as fraud, money laundering, tax evasion, and ransomware scams. Furthermore, many Bitcoin exchanges do not typically provide the public with significant information regarding their ownership structure, management teams, corporate practices, or regulatory compliance. As a result, the marketplace may lose confidence in, or may experience problems relating to, Bitcoin exchanges, including prominent exchanges handling a significant portion of the volume of Bitcoin trading. Regulators are increasingly focused on the use of digital assets in illicit activities, such as money laundering and sanctions violations. While we maintain policies and procedures reasonably designed to promote compliance with applicable anti-money laundering and sanctions laws and to acquire Bitcoin only from regulated entities, if we are found to have unknowingly transacted with bad actors that have used Bitcoin to launder money or persons subject to sanctions, we could face regulatory proceedings and may be prohibited or restricted from engaging in further transactions or dealings in Bitcoin. Furthermore, negative perception, a lack of stability in the broader Bitcoin markets, and the closure or temporary shutdown of Bitcoin exchanges due to fraud, business failure, hackers, malware, or government-mandated regulation may reduce confidence in Bitcoin and result in greater volatility in the prices of Bitcoin. A number of Bitcoin exchanges have been closed due to fraud, failure, or security breaches. In many of these instances, the customers of such Bitcoin exchanges were not compensated or made whole for the partial or complete losses of their account balances in such Bitcoin exchanges. To the extent investors view our Common Shares as linked to the value of our Bitcoin holdings, such a negative perception of Bitcoin exchanges could have a material adverse effect on the price of our Common Shares. It may be illegal now, or in the future, to acquire, own, hold, sell, or use Bitcoin or other digital assets, participate in blockchains or utilize similar digital assets in one or more countries. Although currently digital assets generally are not regulated or are lightly regulated in most countries, countries such as China have taken harsh regulatory action to curb the use of digital assets and may continue to take regulatory action in the future that could severely restrict the right to acquire, own, hold, sell, or use these digital assets or to exchange them for fiat currency. For example, in 2021 China instituted a blanket ban on all digital asset Mining and transactions, including overseas digital asset exchange services taking place in China, effectively making all digital asset-related activities illegal in China. In certain nations, it is illegal to accept payment in Bitcoin or other digital assets for consumer transactions, and banking institutions are barred from accepting deposits of Bitcoin. Such restrictions may adversely affect us as the large-scale use of Bitcoin as a means of exchange is presently confined to certain regions globally. Such circumstances could have a material adverse effect on our business, financial condition, and results of operations and potentially the value of any Bitcoin we mine or otherwise acquire or hold for our own account, ultimately harming investors. If a malicious actor or botnet obtains control of a majority of the processing power active on any digital asset network, including the Bitcoin network, the blockchain may be manipulated in a manner that adversely affects an investment in the Company. If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing power dedicated to Mining on any digital asset network, including the Bitcoin network, it may be able to alter the blockchain by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. In such alternate blocks, the malicious actor or botnet could control, exclude, or modify the ordering of transactions, though it could not generate new digital assets or transactions using such control. Using alternate blocks, the malicious actor could “double-spend” its own digital assets (i.e., spend the same digital assets in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintains control. To the extent that such malicious actor or botnet did not yield its control of the processing power on the Bitcoin or other network, or the Bitcoin or other community did not reject the fraudulent blocks as malicious, reversing any changes made to the blockchain may not be possible. 24 Miners ceasing operations would reduce the collective processing power on the Bitcoin network, which would adversely affect the confirmation process for transactions (i.e., temporarily decreasing the speed at which blocks are added to the Bitcoin blockchain until the next scheduled adjustment in difficulty for block solutions). If a reduction in processing power occurs, the Bitcoin network may be more vulnerable to a malicious actor obtaining control in excess of 50% of the processing power on the Bitcoin network. Although there are no known reports of malicious activity or control of the Bitcoin blockchain achieved through controlling over 50% of the processing power on the network, it is believed that certain Mining Pools may have exceeded, and could exceed, the 50% threshold. The possible crossing of the 50% threshold indicates a greater risk in that a single Mining Pool could exert authority over the validation of Bitcoin transactions. To the extent that the Bitcoin or other digital asset ecosystems, including developers and administrators of Mining Pools, do not act to ensure greater decentralization of Bitcoin or other digital asset Mining processing power, the feasibility of a malicious actor obtaining control of the processing power on the Bitcoin or other network will increase, which may adversely impact our business, financial condition, and results of operations. Forks in the Bitcoin network may occur in the future, which may affect the value of Bitcoin held by the Company. Contributors can propose refinements or improvements to the Bitcoin network’s source code that alter the protocols and software that govern the Bitcoin network and the properties of Bitcoin, including the irreversibility of transactions and limitations on the Mining of new Bitcoin. This is known as a “fork.” In the event a developer or group of developers proposes modifications to the Bitcoin network that are not accepted by a majority of miners and users, but that are nonetheless accepted by a substantial plurality of miners and users, two or more competing and incompatible blockchain implementations could result running in parallel, yet lacking interchangeability and necessitating exchange-type transactions to convert currencies between the two forks. This is known as a “hard fork.” The value of Bitcoin after the creation of a fork is subject to many factors, including the value of the fork product, market reaction to the creation of the fork product, and the occurrence of additional forks in the future. It may be unclear following a fork which fork represents the original asset and which is the new asset. If we hold Bitcoin at the time of a hard fork into two digital assets, industry standards would dictate that we would be expected to hold an equivalent amount of the old and new assets following the fork. However, we may not be able, or it may not be practical, to secure or realize the economic benefit of the new asset for various reasons. For instance, we may determine that there is no safe or practical way to custody the new asset, that trying to do so may pose an unacceptable risk to our holdings in the old asset, or that the costs of taking possession and/or maintaining ownership of the new digital asset exceed the benefits of owning the new digital asset. Additionally, laws, regulation, or other factors may prevent us from benefiting from the new asset even if there is a safe and practical way to custody and secure the new asset. As such, we may not be able to realize the economic benefit of a fork, either immediately or ever, which could adversely affect the value of the Bitcoin we hold as well as our business, financial condition, and results of operations. Fraud or failure of Bitcoin exchanges, custodians, and other trading venues could adversely impact Bitcoin prices and our business, financial condition, and results of operations. Bitcoin market prices depend, directly or indirectly, on the prices set on exchanges and other trading venues. As compared to traditional securities, derivatives and currency exchanges, cryptocurrency exchanges, custodians and other trading venues are relatively new and, in most cases, largely unregulated, which may make them more susceptible to fraud and failure. The fraud and failure of several cryptocurrency platforms and other actors in the industry, including recent and ongoing bankruptcies of several large cryptocurrency exchanges in the second half of 2022 and into early 2023 (namely, FTX Trading Ltd., Celsius Network LLC, BlockFi, Voyager Digital Ltd., Three Arrows Capital, and Genesis Global Holdco LLC), as well as additional market disruptions and bankruptcies in 2024 and 2025, have impacted and may continue to impact the broader cryptocurrency ecosystem, including Bitfarms. In response to these and other recent events, digital asset markets, including the market for Bitcoin specifically, have experienced extreme price volatility, reduced liquidity, and increased uncertainty. Several other entities in the digital asset industry have been, and may continue to be, negatively affected, further undermining confidence in digital asset markets and in Bitcoin. These events have also negatively impacted the liquidity of the digital asset markets and, in turn, the market price of shares of companies in the Bitcoin industry, including us, as certain entities affiliated with bankrupt or distressed cryptocurrency exchanges and trading venues have engaged in significant trading activity. If the liquidity of the digital asset markets continues to be negatively impacted by these or similar events, digital asset prices (including the price of Bitcoin) may continue to experience significant volatility and confidence in the digital asset markets may be further undermined. These and similar events are ongoing and may occur with respect to other participants in the digital asset ecosystem in the future, and it is not possible to predict at this time all of the risks that such events may pose to us, our service providers, the other third parties with which we do business, or the digital asset industry as a whole. Although we have no direct exposure to any of the above-mentioned cryptocurrency companies (other than BlockFi prior to our repayment of indebtedness under our equipment financing arrangement with BlockFi, as discussed in this Annual Report) nor any material assets that may not be recovered or may otherwise be lost or misappropriated due to the bankruptcies, the failure or insolvency of large exchanges may cause the price of Bitcoin to fall and decrease confidence in the larger ecosystem, which could adversely affect an investment in us. Such market volatility has had a material and adverse effect on our results of operations and financial condition, and we expect our results of operations to continue to be affected by the price of Bitcoin as the results of our operations are significantly tied to the price of Bitcoin. 25 These and similar events have had, and, in the future, may have, an adverse impact on the profitability of our Bitcoin Mining operations and our financial condition and results of operations. To the extent that cryptocurrency exchanges or other trading venues are involved in fraud or experience security failures or other operational issues in the future, Bitcoin prices could be suddenly and adversely impacted. Furthermore, fraud or failure of the current and future custodians of our Bitcoin or exchanges can result in a direct loss of our Bitcoin and fiat currency assets, which loss may not be recoverable by us, whether under any insurance policies it has in place or otherwise. Increases in cryptocurrency Network Difficulty and global computing power could reduce our Mining revenues and adversely affect our results of operations and financial condition. Network Difficulty is a measure of how difficult it is to solve the cryptographic hash that is required to validate a block of transactions and earn a cryptocurrency reward from Mining. As Mining companies produce more hashrate and the Bitcoin network hashrate is increased, the Bitcoin Network Difficulty is adjusted upwards by requiring more hashrate to be deployed to solve a block. Thus, Mining companies are further incentivized to grow their hashrate to maintain or improve their chance of earning new Bitcoin rewards. In theory, these dual processes should continually replicate themselves until the supply of available Bitcoin is exhausted. In response, Mining companies have attempted to achieve greater hashrate by deploying increasingly sophisticated, powerful and expensive Miners in ever greater quantities. If the price of Bitcoin is not sufficiently high to allow us to fund our desired hashrate growth, including through new Miner acquisitions, and if we are otherwise unable to access additional capital to acquire Miners, our hashrate may stagnate and fall behind our competitors, potentially resulting in a decline in our revenues, which would have a material adverse effect on our results of operations and financial condition. Additionally, the open-source structure of the Bitcoin network protocol means the developers to the protocol are typically not directly compensated for their contributions in maintaining and developing the protocol. Failure to properly monitor and upgrade the Bitcoin network protocol could damage the Bitcoin network and could have a material adverse effect on our business, financial position and results of operations, and could cause the market value of our Common Shares to decline. Bitcoin transactions are irreversible, and erroneous or compromised transfers could result in permanent losses that adversely affect our business. Bitcoin transactions are irreversible. Improper or compromised transfers are also generally irreversible and irrevocable. Such errors may be the result of computer or human error despite internal controls we have adopted to mitigate this risk. To the extent that we are unable to seek a corrective transaction with the third party or are incapable of identifying the third party that has received our Bitcoin through error or theft, we will be unable to revert or otherwise recover incorrectly transferred Bitcoin. We may also be unable to convert or recover Bitcoin transferred to uncontrolled accounts. The use of Bitcoin to, among other things, buy and sell goods and services and complete other transactions is part of a new and rapidly evolving industry that employs digital assets based upon a computer generated mathematical and/or cryptographic protocol. The growth of this industry in general, and the use of Bitcoin in particular, is subject to a high degree of uncertainty, and the slowing or stopping of the development or acceptance of developing protocols may adversely affect our operations. The factors affecting the further development of the industry, include, but are not limited to: ● Continued worldwide growth in the adoption and use of Bitcoin; ● Governmental and quasi-governmental regulation of Bitcoin and its use, or restrictions on or regulation of access to and operation of the network or similar cryptocurrency systems; 26 ● Changes in consumer demographics and public tastes and preferences; ● The maintenance and development of the open-source software protocol of the network; ● The availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies; ● General economic conditions and the regulatory environment relating to digital assets; and Negative consumer sentiment and perception of Bitcoin specifically and cryptocurrencies generally. Risks Related to Intellectual Property, Information Technology, Data Security and Privacy Cybersecurity threats and hacking attacks could compromise our systems and data, resulting in material adverse effects on our business, financial condition, and results of operations. Threats to network and data security are increasingly diverse and sophisticated, and security breaches, computer malware and computer hacking attacks have been an increasing concern and could be enhanced or facilitated by AI. Despite our efforts and processes in place to prevent them, our computer servers and systems may be vulnerable to cybersecurity risks, including denial-of-service attacks, physical or electronic break-ins, employee theft or misuse and similar disruptions from unauthorized tampering. As techniques used to breach security change frequently and are generally not recognized until launched against a target, we may not be able to promptly detect that a cyber breach has occurred, implement security measures in a timely manner or, when implemented, we may not be able to determine the extent to which these measures could be circumvented. Recent developments in the cyber threat landscape include the use of AI and machine learning, as well as an increased number of cyber extortion and ransomware attacks, with the potential for higher ransom demand amounts and increasing sophistication and variety of ransomware techniques and methodology. Further, any adoption of AI by us or by third parties may pose new security challenges. A party who is able to compromise the security measures on our networks or the security of our infrastructure could misappropriate the proprietary or sensitive information of us or employees, or cause interruptions or malfunctions in our operations. Such a compromise could be particularly harmful to our brand and reputation. We also may be required to expend significant capital and resources to protect against such threats or to alleviate problems caused by cyber breaches in our physical or virtual security systems. Any breaches that may occur in the future could expose us to increased risk of lawsuits, regulatory penalties, loss of potential customers, damage relating to loss of proprietary information, harm to our reputation, and increases in security costs, which could have a material adverse effect on our business, financial condition, and results of operations. The cybersecurity regulatory landscape continues to evolve and compliance with the proposed reporting requirements could further complicate our ability to resolve cyber-attacks. Comprehensive cyber risk coverage may be limited in availability, and even when implemented, may not fully cover all potential losses associated with cyber incidents. We will take measures to protect us and our Bitcoin from unauthorized access, damage or theft; however, it is possible that our security systems may not prevent improper access to, or damage or theft of, our Bitcoin holdings. A security breach could harm our reputation or result in the loss of some or all of our Bitcoin. A resulting perception that our measures do not adequately protect our Bitcoin holdings could result in a loss of current or potential shareholders, reducing demand for our Common Shares and causing our shares to decrease in value. Server or Internet failures could interrupt our operations and cause us significant economic harm. At any time, the servers, central processing units, GPUs, networking equipment, or other critical computing infrastructure utilized by us could experience a severe malfunction and/or collapse. Although we will work to reduce this risk by employing a team of experts with many years of experience in building and managing data centers as well as a hardware team that focuses, among other things, on Miner repair and the daily evaluation of the technical condition of the Bitcoin data centers and HPC data centers that we operate, including through software (developed by our management) that facilitates, among other things, control, management and reporting of malfunctions in real time or any server crashes or failures, even if quickly addressed, such malfunctions may interrupt our operations and cause us significant economic harm. 27 Our HPC data centers will rely on the continuous and reliable operation of high-density computing equipment, advanced cooling systems, and power distribution infrastructure. A failure of any of these systems could result in downtime that impairs our ability to meet the service level commitments in our future lease agreements with HPC data center tenants, which could give rise to financial penalties, service credits, early lease terminations, claims for damages, lost revenue, and reputational harm that could adversely affect our ability to attract and retain tenants. In addition, Internet disruptions or failures may adversely affect the Mining and use of cryptocurrencies, including Bitcoin, as well as our HPC data center operations. Generally, cryptocurrencies and our business of Mining Bitcoin are dependent upon the Internet. A significant disruption or failure of Internet connectivity, including of our backup Internet connection, could disrupt the network operations of Bitcoin until the disruption is resolved and have an adverse effect on the price of Bitcoin and our ability to mine Bitcoin. Our HPC data centers will likely require continuous, high-speed, and low-latency Internet and fiber connectivity to support the compute workloads of our tenants. We expect to depend on third-party fiber network providers to deliver this connectivity, and we may have limited control over the reliability, redundancy, or restoration timelines of such third-party networks. Any significant disruption or degradation of fiber connectivity or Internet service to our HPC data centers—whether caused by fiber cuts, equipment failures, cyberattacks, natural disasters, or other events—could impair our tenants’ operations and our ability to satisfy the uptime and performance commitments in our lease agreements. Such disruptions could result in service level penalties, lost revenue, tenant claims for damages, early lease terminations, and reputational damage, any of which could have a material adverse effect on our business, financial condition, and results of operations. Any potential use of emerging technologies like AI, machine learning and generative AI could lead to unintended consequences and result in reputational harm and litigation. We continue to evaluate emerging technologies like AI, machine learning and generative AI for incorporation into our business. State and federal regulations relating to these emerging technologies are quickly evolving, and should we adopt such technologies, we may require significant resources to maintain our business practices while seeking to comply with U.S. laws. Any failure to accurately identify and address our responsibilities and liabilities in this new environment could negatively affect any solutions we develop that incorporate such technologies and could subject us to reputational harm, regulatory action or litigation, any of which may harm our financial condition and operating results. These same risks apply to our use of third-party service providers who are implementing these tools into the products or services they provide to us. We are currently making considerable investments in our information technology systems and processes. Difficulties from or disruptions to these efforts may interrupt our normal operations and adversely affect our business and results of operations. We have been making considerable investments in our information technology systems and processes and expect such investment to continue for the foreseeable future in support of our Bitcoin Mining operations and our expansion into HPC hosting and colocation. These continuing investments and upgrades include the implementation of new tools and technologies to further streamline and automate processes, including with respect to procurement, and to support our compliance with evolving U.S. GAAP. These investments and upgrades and may take longer to complete and cost more than originally planned. As a result of our continued work on these projects, we may experience difficulties with our systems and business disruptions. Any such difficulties or disruptions may adversely affect our business and results of operations. Risks Related to our Corporate Structure and Organization Our compliance and risk management methods might not be effective and may result in outcomes that could adversely affect our reputation, operating results, and financial condition. Our ability to comply with applicable complex and evolving laws, regulations, and rules is largely dependent on the maintenance of our compliance, audit, and reporting systems, as well as our ability to attract and retain qualified compliance and other risk management personnel. While we devote significant resources to develop policies and procedures to identify, monitor and manage our risks, we cannot assure you that our policies and procedures will always be effective against all types of risks, including unidentified or unanticipated risks, or that we will always be successful in monitoring or evaluating the risks to which we are or may be exposed in all market environments. We are exposed to fluctuations in currency exchange rates, which could negatively affect our financial condition and results of operations. We are exposed to fluctuations in currency exchange rates which could negatively affect our financial condition and results of operations. In particular, exchange rate fluctuations may affect the costs that we incur in our operations. Bitcoin are generally sold in U.S. dollars and a portion of our costs are incurred in Canadian dollars. The appreciation of non-U.S. dollar currencies against the U.S. dollar could increase the cost of Mining in U.S. dollar terms. Furthermore, we intend to operate HPC data centers in both the U.S. and Canada, and such operations will generate revenue in the currency of the data center location. In addition, we hold cash balances in both U.S. dollars and Canadian dollars, the values of which are impacted by fluctuations in currency exchange rates. 28 Our business could be negatively impacted by unsolicited investor interest, takeover proposals, shareholder activism or proxy contests. We could be negatively impacted by unsolicited investor interest, takeover proposals, shareholder activism, or proxy contests . In the future, similar actions taken by third parties, including unsolicited takeover proposals, the initiation of proxy contests, and litigation by adverse parties, could disrupt our business, distract management from efforts to improve the business, cause us to incur substantial additional expenses, create perceived uncertainties as to our future direction, and result in significant fluctuations in the price of our Common Shares, all of which could harm our business and materially and adversely affect our results of operations. In addition, anti-takeover provisions in our governing documents and under applicable law could make an acquisition of our company more difficult, limit attempts by our stockholders to replace or remove our current management and directors, and depress the market price of our common stock. These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management, even if such changes may be considered beneficial by some stockholders. Furthermore, we may become subject to shareholder litigation, class actions, or other legal proceedings in connection with such events, which may divert management’s attention and resources from the operation of the business and result in substantial costs and damages. We have in the past identified and remediated material weaknesses in our internal control over financial reporting, and our failure to maintain effective internal controls could adversely affect our financial reporting and the price of our Common Shares. Under National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings and Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), we are required to document and test our internal control procedures and prepare annual management assessments of the effectiveness of our internal control over financial reporting. Our assessments must include disclosure of identified material weaknesses in our internal control over financial reporting. The existence of one or more material weaknesses could affect the accuracy and timing of our financial reporting. Testing and maintaining internal control over financial reporting involves significant costs and could divert management’s attention from other matters that are important to our business. Additionally, we may not be successful in remediating any deficiencies that may be identified. Management identified a material weakness in the effectiveness of our internal controls over financial reporting for each of the years ended December 31, 2021, 2022, 2023, and 2024, which was remediated in 2025, related to controls over accounting for complex transactions. For more information, including a description of the remediation efforts that were required to address the identified material weakness, refer to Item 9A, “Controls and Procedures” section in this Annual Report. We cannot assure investors that the measures we have taken or, in the future, will take will in fact be sufficient to remediate the control deficiencies that led to the material weakness in our internal control over financial reporting or that such measures will prevent or avoid potential future material weaknesses, and our current controls and any new controls that we develop may become inadequate because of changes in conditions in our business. Further, additional weaknesses in our internal control over financial reporting may be discovered in the future. If we identify and are unable to remediate any future material weaknesses and otherwise implement and maintain effective internal control over financial reporting, there may be material misstatements in our consolidated financial statements, we may be unable to comply with our reporting obligations on a timely basis, or we may fail to prevent or detect fraud. In any such case, the price of the Common Shares could be negatively impacted, and we could be unable to raise additional capital on terms acceptable to management or at all. The lack of effective internal controls could thus materially adversely affect our financial condition and ability to implement our business plan. Even if we were to conclude in the future that our internal control over financial reporting provides reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. GAAP, because of its inherent limitations, internal control over financial reporting may not prevent or detect all instances of fraud or misstatements. Regardless of how well designed and operated a control system may be, it can only provide reasonable, not absolute, safeguards with respect to the reliability of financial reporting and financial statement preparation. 29 Requirements associated with being a public company in the United States and Canada require significant company resources and management attention. As a public company, we are subject to certain reporting requirements of the Exchange Act, Canadian securities laws and other rules and regulations of the SEC, Nasdaq and the TSX. We are also subject to various other regulatory requirements, including the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Wall Street Reform and Consumer Protection Act. These rules require, among other things, the maintenance of effective disclosure and financial controls and procedures, internal control over financial reporting, changes in corporate governance practices, among many other complex rules that are often difficult to monitor and maintain compliance with. Our management and other personnel will need to devote a substantial amount of time to ensure compliance with all of these requirements and to keep pace with new regulations, otherwise we may fall out of compliance and risk becoming subject to fines, sanctions, litigation, being delisted and/or other regulatory action, among other potential problems. We have prepared our consolidated financial statements in accordance with U.S. GAAP, as opposed to IFRS Accounting Standards. Such conversion and modifications incurred additional one-time costs to present certain of our historic financial statements in accordance with U.S. GAAP retrospectively. The expenses incurred by public companies generally for reporting and corporate governance purposes have been increasing. We have hired or intend to hire additional accounting, finance, compliance and other personnel or engage external consultants in connection with our efforts to comply with the requirements of being a public company. These requirements increase our legal and financial compliance costs and make some activities more time-consuming and costly. For example, we expect that the rules and regulations applicable to us as a public company may make it increasingly more difficult and more expensive for us to obtain certain types of insurance, including director and officer liability insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. These laws and regulations could also make it increasingly more difficult for us to attract and retain qualified persons to serve on the Board and committees of the Board, or as executive officers. These rules and regulations are often subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. We are currently subject to securities class action litigation and may be subject to similar or other litigation in the future, which may divert management’s attention. On May 9, 2025, a purported shareholder filed a putative class action complaint in the United States District Court for the Eastern District of New York, in a case titled Olympio v. Bitfarms Ltd., Benjamin Gagnon, Jeffrey Lucas, and Geoff Morphy, case no 1:25-cv-02630, alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, promulgated thereunder. The lawsuit alleges that we, our current Chief Executive Officer, our former Chief Financial Officer and our former Chief Executive Officer made materially false and/or misleading statements regarding our business, operations and internal controls over financial reporting (refer to Item 3. “Legal Proceedings”). We cannot predict the duration or outcome of this lawsuit at this time. As a result, we are unable to estimate the reasonably possible loss arising from this lawsuit. We are vigorously defending ourselves in this matter. The claims in this lawsuit arise from circumstances related to the restatement described in previous filings, and any adverse outcome could compound the costs and other adverse effects of the Restatement on our business, financial condition and the price of our Common Shares. There may be additional suits or proceedings brought against us in the future. Monitoring and defending against legal actions, whether or not meritorious, consumes time and resources from our management and detracts from our ability to fully focus our internal resources on our business activities. The duration of legal actions cannot be predicted, and they are subject to several factors outside of our control. In addition, we may incur substantial legal fees and other costs in connection with litigation and there can be no guarantee that we achieve a successful outcome in any legal actions in which it is involved, in whole or in part. We have not at this time established any reserves for any potential liability relating to these lawsuits. It is possible that we could, in the future, incur judgment or enter into settlement of claims for monetary damages. A decision adverse to our interests in this lawsuit (or any future lawsuits, whether related or not) could result in the payment of substantial damages and could have a material adverse effect on our business, results of operations and financial condition. In addition, the uncertainty of the currently pending lawsuit could lead to volatility in the price of our Common Shares. 30 Risks Related to the Company’s Capital Needs and Capital Strategy We may require additional capital in the future, and there can be no assurance that financing will be available on acceptable terms, which could result in dilution to existing shareholders. As of December 31, 2025, we had cash of $573.5 million, compared to $59.5 million as of December 31, 2024. In November 2025, we received approximately $568.9 million of net proceeds from the issuance of the Convertible Notes and the purchase of capped call transactions. We expect to continue to depend upon selling Bitcoin earned and in treasury and utilizing short-term debt, long-term debt and equity instruments to fund our ongoing expansion activities, operating expenses and debt service requirements. Further, we expect that we will need to raise additional capital in the future to fund development, more rapid expansion, respond to competitive pressures, acquire complementary businesses or technologies or take advantage of unanticipated opportunities, and we may seek to do so through public or private financing, strategic relationships or other arrangements. Our ability to secure any required financing will depend in part upon prevailing capital market conditions and business success. There can be no assurance that we will be successful in our efforts to secure any additional financing on terms satisfactory to Management or at all. Even if such funding is available, we cannot predict the size of future issues of Common Shares or securities convertible into Common Shares or the effect, if any, that future issues and sales of Common Shares will have on the price of our Common Shares. If we raise additional capital through the issuance of equity securities, the percentage ownership of our existing shareholders may be reduced, and such existing shareholders may experience additional dilution in net book value per share. Any such newly-issued equity securities may also have rights, preferences or privileges senior to those of the holders of the Common Shares. If additional funds are raised through the incurrence of indebtedness, such indebtedness may involve restrictive covenants that impair our ability of to pursue our growth strategy and other aspects of our business plan, expose us to greater interest rate risk and volatility, require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital and capital expenditures, increase our vulnerability to general adverse economic and industry conditions, place us at a competitive disadvantage compared to our competitors that have less debt, limit our ability to borrow additional funds, and otherwise subject us to the risks discussed herein. In connection with any such future capital raising transaction, whether involving the issuance of equity securities or the incurrence of indebtedness, we may be required to accept terms that restrict our ability to raise additional capital for a period of time, which may limit or prevent us from raising capital at times when it would otherwise be opportunistic to do so. If adequate funds are not available on acceptable terms or at all, we may be unable to develop or enhance our business, take advantage of future opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and operating results. Our hedging activities may not be effective and could result in significant losses that adversely affect our results of operations and financial condition. We may actively engage in hedging practices with respect to our Bitcoin holdings to lessen the impact of Bitcoin volatility on our results of operations and financial condition and to optimize Bitcoin monetization. Such practices may include selling short- and long-dated call options on Bitcoin held in treasury and on anticipated future Bitcoin production. Although we undertake hedging activities with the objective of risk mitigation, there can be no certainty that such activities will be profitable, and these activities could result in significant losses. In particular, such option strategies may cap the upside potential of our Bitcoin holdings in a rising market, and realized or unrealized losses on derivative positions could have a material adverse effect on our results of operations. 31 In addition, hedging practices involve transactions with third parties. Any settlement delay or failure, security breach, incurred cost or loss of digital assets associated with the use of a counterparty could materially and adversely affect the execution of hedging strategies and result in significant losses. Although we maintain rigorous controls on the implementation and monitoring of hedging strategies, including our involvement with counterparties, there can be no assurance that such controls will be effective or timely or sufficient in operation to avoid or even reduce losses. Such hedging transactions may also limit the opportunity for gain if the values of the portfolio investments should increase. Moreover, it may not be possible to hedge against a particular fluctuation that is so generally anticipated by the markets that a hedging transaction at an acceptable price is unavailable. In light of these and other factors, we may not be successful in mitigating our exposure to volatile economic conditions through any hedging transactions it undertakes. Adverse global financial conditions and market volatility could affect our ability to obtain financing and may result in declines in our asset values and Common Share price. Global financial conditions over the last few years have been characterized by volatility, which has contributed to the bankruptcy of several financial institutions in the United States or the rescue thereof by governmental authorities. The continuation of such adverse economic conditions and other related factors may affect our ability to obtain equity or debt financing in the future on terms favorable to us, or at all, and may cause decreases in asset values that are deemed to be other than temporary, which may result in impairment losses. If such levels of volatility and market turmoil continue, our financial condition may suffer and the price of our Common Shares may be adversely affected. Common Shares issuable upon conversion of the Convertible Notes may dilute the ownership interest of our shareholders or may adversely affect the market price of our Common Shares. The conversion of the Convertible Notes may dilute the ownership interests of our shareholders. Upon conversion of the Convertible Notes, we will generally have the right to elect to settle conversions by paying or delivering, as applicable, cash, Common Shares or a combination of cash and Common Shares. If we elect to settle our conversion obligation in Common Shares or a combination of cash and Common Shares, any sales in the public market of our Common Shares issuable upon such conversion could adversely affect prevailing market prices of our Common Shares. Also, the existence of the Convertible Notes may encourage short selling by market participants as a result of hedging or arbitrage trading activity that we expect certain investors in the Convertible Notes engage in, or anticipated conversion of the Convertible Notes into our Common Shares could depress the price of our Common Shares. The capped call transactions may affect the value of the Convertible Notes and the market price of our Common Shares. In connection with the issuance of the Convertible Notes, we entered into privately negotiated capped call transactions with certain financial institutions (collectively, the “option counterparties”). The capped call transactions are generally expected to reduce the potential economic dilution upon any conversion of the Convertible Notes or offset any cash payments we are required to make in excess of the principal amount of converted Convertible Notes, with such reduction or offset subject to a cap. In connection with establishing their initial hedges of the capped call transactions, the option counterparties entered into various derivative transactions with respect to our Common Shares and/or purchased shares of our Common Shares concurrently with, or shortly after, the pricing of the Convertible Notes. They may modify their hedge positions by entering into or unwinding various derivatives with respect to our Common Shares and/or purchasing or selling shares of our Common Shares or other securities of ours in secondary market transactions prior to the maturity of the Convertible Notes, and they are likely to do so during any “observation period” related to a conversion of Convertible Notes or, to the extent we exercise the relevant election under the capped call transactions, following any repurchase or redemption of the Convertible Notes, as described in the Indenture, dated as of October 21, 2025, by and among us, Computershare Trust Company, N.A., as trustee and Computershare Trust Company of Canada, as Canadian co-trustee. This activity could also cause or avoid an increase or a decrease in the market price of our Common Shares or the Convertible Notes. 32 We are subject to counterparty risk with respect to the capped call transactions. The option counterparties are financial institutions, and we will be subject to the risk that any or all of them might default under the capped call transactions. Our exposure to the credit risk of the option counterparties will not be secured by any collateral. Past global economic conditions have resulted in the actual or perceived failure or financial difficulties of many financial institutions and could adversely affect the option counterparties’ performance under the capped call transactions. If an option counterparty becomes subject to insolvency proceedings, we will become an unsecured creditor in those proceedings with a claim equal to our exposure at that time under the capped call transactions with such option counterparty. Our exposure will depend on many factors but, generally, an increase in our exposure will be correlated to an increase in the market price and in the volatility of our Common Shares. In addition, upon a default by an option counterparty, we may suffer more dilution, the effect of which would not be compensated for, than we currently anticipate with respect to our Common Shares. We can provide no assurance as to the financial stability or viability of the option counterparties. Risks Related to Regulatory Matters Regulatory developments surrounding HPC and AI may negatively impact our efforts to expand into HPC Infrastructure. The regulatory landscape surrounding HPC, AI and Bitcoin Mining operations is evolving rapidly, and we anticipate increased scrutiny and potential regulation in the near and long term. These developments may affect our business and operations in ways that are difficult to predict. There are growing concerns about the ethical implications and potential misuse of the growing AI technologies and the AI landscape is facing challenges and uncertainties. The development of more advanced AI systems, such as large language models and generative AI, has raised concerns about potential misuse, bias, and the displacement of human workers. Governments and regulatory bodies are considering measures to ensure responsible development and deployment of AI systems, including guidelines for transparency, accountability, and fairness. In recent years, crypto Mining has received increased attention from regulators with respect to technical and financial aspects of this industry. We expect that regulatory efforts in this area will continue to evolve and potentially affect our business. As a company operating at the intersection of HPC, AI, and Bitcoin Mining, we are committed to maintaining a proactive and adaptive approach to regulatory compliance. We continue to monitor legislative and regulatory developments closely and engage in dialogue with relevant stakeholders to ensure our business practices align with the evolving legal and regulatory framework. However, there can be no assurance that our business will not be adversely impacted by future developments. We are required to obtain, and to comply with, government permits and approvals. We are required to obtain, and to comply with, numerous permits and licenses from federal, state and local governmental agencies. The process of obtaining and renewing necessary permits and licenses can be lengthy and complex and can sometimes result in the establishment of conditions that make the project or activity for which the permit or license was sought unprofitable or otherwise unattractive. In addition, such permits or licenses may be subject to denial, revocation or modification under various circumstances. Failure to timely obtain or comply with the conditions of permits or licenses, or failure to comply with applicable laws or regulations, may result in the delay or temporary suspension of our operations and electricity sales or the curtailment of our delivery of electricity to our customers and may subject us to penalties and other sanctions. Although various regulators routinely renew existing permits and licenses, renewal of our existing permits or licenses could be denied or jeopardized by various factors, including, among others: (i) failure to provide adequate financial assurance for closure, (ii) failure to comply with environmental, health and safety laws and regulations or permit conditions, (iii) local community, political or other opposition and (iv) executive, legislative or regulatory action. Our inability to procure and comply with the permits and licenses required for our operations, or the cost to us of such procurement or compliance, could have a material adverse effect on us. In addition, new environmental legislation or regulations, if enacted, or changed interpretations of existing laws, may cause activities at our facilities to need to be changed to avoid violating applicable laws and regulations or elicit claims that historical activities at our facilities violated applicable laws and regulations. In addition to the possible imposition of fines in the case of any such violations, we may be required to undertake significant capital investments and obtain additional operating permits or licenses, which could have a material adverse effect on us. Land reclamation requirements may be burdensome and expensive. We operate in partnership with local environmental authorities to reclaim coal refuse piles. Reclamation may include requirements to control dispersion of potentially deleterious effluents, treat ground and surface water to drinking water standards and reasonably re-establish pre-disturbance landforms and vegetation. To carry out reclamation obligations, we must allocate financial resources that might otherwise be spent on implementing our business plan. If the costs associated with our reclamation work are higher than anticipated, our financial position could be adversely affected. 33 The combustion of coal refuse at our Scrubgrass and Panther Creek power generating facilities is subject to environmental, safety and energy transition risks that could result in significant liabilities and adversely impact our business, financial condition and results of operations. Our operations and use of coal refuse as feedstock at our power generating facilities, including the combustion, storage, and transportation of coal refuse, present a series of environmental and human health and safety risks. Such risks, including the accidental release of coal refuse and other materials into the environment, among others, may not be fully avoidable and could cause us to incur significant clean-up costs and liabilities. We may not be able to recover some or any of these costs from insurance. Our combustion of coal refuse is also subject to stringent federal, state and local laws and regulations governing air and water quality, hazardous and solid waste disposal and other environmental matters. Compliance with these requirements requires significant expenditures for the installation, maintenance and operation of pollution control equipment, monitoring systems and other equipment or facilities. Any policy initiatives or directives, either at the federal or state level, limiting our ability to use coal refuse as feedstock at our Scrubgrass and Panther Creek power generating facilities could adversely impact our operations and potentially reduce the extent of our business, any of which could have a material adverse effect on our business, results of operations and financial condition. The availability and cost of emission allowances due to the cost of coal refuse could adversely impact our costs of operations. We are required to maintain, through either allocations or purchases, sufficient emission allowances for sulfur dioxide, CO2 and NOx to support our operations in the ordinary course of operating our power generation facilities. These allowances are used to meet the obligations imposed on us by various applicable environmental laws. If our operational needs require more than our allocated allowances, we may be forced to purchase such allowances on the open market, which could be costly. If we are unable to maintain sufficient emission allowances to match our operational needs, we may have to curtail our operations so as not to exceed our available emission allowances or install costly new emission controls. As we use the emission allowances that we have purchased on the open market, costs associated with such purchases will be recognized as operating expense. If such allowances are available for purchase, but only at significantly higher prices, the purchase of such allowances could materially increase our costs of operations in the affected markets. Natural or man-made events may cause power production to fall below expectations. Our electricity generation depends upon our ability to maintain the working order of our coal refuse power generation facility. A natural or man-made disaster, severe weather such as snow and ice storms, or accident could impede our ability to access the coal refuse that is necessary for our plant to operate, damage our transmission line preventing us from distributing power to the PJM grid and our Miners or require us to shut down our plant or related equipment, services and facilities. To the extent we experience a prolonged interruption at our plant or a transmission outage due to natural or man- made events, our electricity generation levels could materially decrease. We may also incur significant repair and clean-up costs associated with these events. The effect of the failure of the plant to operate as planned as described above could have a material adverse effect on our business, financial condition and results of operations. We may not be able to operate the power generation facility as planned, which may increase our expenses and decrease our revenues and have an adverse effect on our financial performance. Our operation of the power generation facility, information technology systems and other assets and conduct of other activities subjects us to a variety of risks, including the breakdown or failure of equipment, plant downtimes and related maintenance costs, accidents, security breaches, viruses or outages affecting information technology systems, labor disputes, obsolescence, delivery/transportation problems and disruptions of fuel supply and performance below expected levels. These events may impact our ability to conduct our businesses efficiently and lead to increased or unexpected costs, expenses or losses. Planned and unplanned outages at our power generation facilities may require us to purchase power at then-current market prices to satisfy our commitments or, alternatively, pay penalties and damages for failure to satisfy them. Having to purchase power at then-market rates could also have a negative impact on the cost structure of certain of our compute power operations dedicated to Mining. 34 Although we maintain customary insurance coverage for certain of these risks, no assurance can be given that such insurance coverage will be sufficient to compensate us fully in the event losses occur and no assurance can be given that such insurance coverage will be maintained. Risks Related to Certain Regulations and Laws, Including Tax Laws Political uncertainty in the U.S. and internationally could adversely affect the broader cryptocurrency industry and our business, financial condition, and results of operation. In the last several years, the United States and certain European countries have experienced political events that have cast uncertainty on global financial and economic markets. Since the 2016 United States presidential election, for example, the United States has withdrawn from the Trans-Pacific Partnership and Congress has passed sweeping tax reform, which, among other things, reduced United States corporate tax rates. In the past, the United States administration has also taken action with respect to reduction of regulation. Trends such as these may affect the relative competitiveness of and impose additional costs or liabilities on other jurisdictions, including Canada. It is unclear exactly what other actions may be proposed or implemented by the new United States administration, and if implemented, how such actions may impact the broader cryptocurrency industry. Any actions taken by the current United States administration may have a negative impact on the Canadian economy and on the businesses, financial conditions and results of operations of companies operating in the cryptocurrency industry, including us. While we believe that the current political climate in Canada and the United States is generally favorable towards cryptocurrency Mining, it is impossible to predict how future changes in domestic and international policy may impact us specifically and the industry as a whole. Our interactions with a blockchain may expose us to specially designated nationals (“SDN”) or blocked persons and new legislation or regulation could adversely impact our business or the market for digital assets. We are required to comply with sanctions programs administered by the Office of Financial Assets Control (“OFAC”) of the U.S. Department of Treasury and may be required to comply with similar sanctions programs maintained by other jurisdictions. We are generally prohibited from conducting business with persons named on its SDN list or other sanctioned persons. However, because of the pseudonymous nature of blockchain transactions, we cannot exclude the possibility that we could inadvertently engage in transactions with persons on the SDN list or other sanctioned persons. Our policies prohibit any transactions with sanctioned persons, and we take commercially reasonable steps to avoid such transactions, but we may not always be able to accurately determine the ultimate identity of the individual with whom we transact in Bitcoin. Moreover, there is a risk that some bad actors will continue to attempt to use digital assets, including Bitcoin, as a potential means of avoiding federally imposed sanctions. We are unable to predict the nature or extent of new and proposed legislation and regulation affecting the digital asset industry, or the potential impact of the use of Bitcoin or other digital assets by sanctioned persons, which could have material adverse effects on our business, financial condition, and results of operations and our industry more broadly. Further, we may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties as a result of any enforcement actions, all of which could harm our business, financial condition, and results of operations. We are unable to predict the nature or extent of new and proposed legislation and regulation affecting the digital asset industry, or the potential impact of the use of Bitcoin or other digital assets by SDN or other blocked or sanctioned persons, which could have material adverse effects on our business, financial condition, and results of operations and our industry more broadly. Further, we may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties as a result of any enforcement actions, all of which could harm our business, financial condition, and results of operations. 35 Violations of the U.S. Foreign Corrupt Practices Act and similar anti-bribery legislation could have a material adverse effect on our reputation, business, and financial condition. The Foreign Corrupt Practices Act (United States), the Corruption of Foreign Public Officials Act (Canada) and anti-bribery laws in other jurisdictions generally prohibit companies and their intermediaries from making improper payments for the purpose of obtaining or retaining business or other commercial advantages. We have policies in place that mandate compliance with applicable anti-bribery laws, which laws, if violated, provide for the levy of substantial penalties against offending parties. We use our best efforts to prevent the occurrence of bribery and corruption and have policies and procedures in place to minimize such risks, including enforcement of policies against giving or accepting money or gifts; namely our Code of Business Conduct and Ethics, Anti-Bribery and Anti-Corruption Policy and Whistleblower Policy. There can be no assurance, however, that our policies and procedures will always protect us from reckless or other inappropriate acts contrary to our policies committed by our affiliates, employees, agents or companies acquired by or merged with us. Any allegations of non-compliance with anti-bribery laws could subject us to whistleblower complaints, adverse media coverage, investigations, enforcement actions, fines, damages, significant administrative, civil and/or criminal sanctions, collateral consequences, remedial measures, and legal expenses, all of which could materially and adversely affect our business, prospects, financial condition and results of operations, as well as our reputation. Responding to any investigation or action could result in a materially significant diversion of management’s attention and resources and significant defense costs and other professional fees. Changes in tax laws or unanticipated tax liabilities could adversely affect our effective income tax rate and profitability. We are subject to income taxes in various jurisdictions in the United States and Canada and may become subject to taxation in additional jurisdictions as we expand our business. Our effective tax rate could be adversely affected in the future by several factors, including changes in the valuation of deferred tax assets and liabilities, changes in tax laws and regulations or their interpretations and application, changes in the geographic mix of our earnings, and the outcome of income tax audits in any of the jurisdictions in which we operate or are otherwise subject to tax. A significant change in U.S. or Canadian tax laws and regulations may materially and adversely impact our income tax liability, provision for income taxes, and effective tax rate. We regularly assess these matters to determine the adequacy of our income tax provision, which is subject to significant judgment. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. Although we believe our tax estimates are reasonable, the outcome of income tax audits and related litigation could be materially different than what is reflected in our historical income tax provisions and accruals. There can be no assurance that the resolution of any audits or litigation will not have an adverse effect on business, financial condition, and results of operations. Changes in tax credits related to coal refuse power generation could have a material adverse effect on our business, financial condition, results of operations and future development efforts. The profitability of our operations at Scrubgrass and Panther Creek depends, in part, on the continued availability of state renewable energy tax credits offered by the Commonwealth of Pennsylvania, US through programs such as the one established under The Alternative Energy Portfolio Standards Act of 2004 or the Coal Refuse Energy and Reclamation Tax Credit Program established by Act 84 of July 13, 2016. These tax credit programs could be changed or eliminated as a result of state budget considerations or otherwise. Reduction or elimination of such credits could materially and adversely harm our business, financial condition, results of operations and future development efforts. 36 Our business is subject to substantial energy regulation and may be adversely affected by legislative or regulatory changes, as well as liability under, or any future inability to comply with existing or future energy regulations or requirements. Our business is subject to extensive U.S. federal, state and local laws. Compliance with, or changes to, the requirements under these legal and regulatory regimes may cause us to incur significant additional costs or adversely impact our ability to compete on favorable terms with competitors. Failure to comply with such requirements could result in the shutdown of a non-complying facility, the imposition of liens, fines, and/or civil or criminal liability and/or costly litigation before the agencies and/or in state of federal court. The regulatory environment has undergone significant changes in the last several years due to load growth and to state and federal policies affecting wholesale competition and the creation of incentives for the addition of large amounts of new generation and transmission to meet that load growth and maintain grid reliability. Increasing new and projected load growth includes actual and announced additions of large data centers in the region in which we operate—PJM—to meet growing AI usage needs. These changes are ongoing, and we cannot predict the future design of the wholesale power markets or the ultimate effect that the changing regulatory environment will have on our business. In addition, in some of these markets, interested parties have proposed material market design changes, including the elimination of a single clearing price mechanism, as well as proposals to reinstate the vertically-integrated-monopoly model of utility ownership or to require divestiture by generating companies to reduce their market share. If competitive restructuring of the electric power markets is reversed, discontinued, delayed, or materially altered, our business prospects and financial results could be negatively impacted. We are subject to extensive environmental regulation, and failure to comply with environmental laws or changes in such laws could result in significant liabilities and have a material adverse effect on our business. We are subject to extensive environmental regulation by governmental authorities, including the U.S. and Canadian federal, state, and provincial environmental agencies and attorneys general. Our operations may be subject to foreign, federal, state, provincial, and local laws and regulations related to air and water quality, hazardous and solid waste disposal, and other environmental matters. We may incur significant additional costs beyond those currently contemplated to comply with these regulatory requirements. If we fail to comply with these regulatory requirements, we could be forced to reduce or discontinue operations or become subject to administrative, civil, or criminal liabilities and fines. Existing environmental regulations could be revised or reinterpreted, new laws and regulations could be adopted or become applicable to us or our facilities, and future changes in environmental laws and regulations could occur, including potential regulatory and enforcement developments related to air emissions, all of which could result in significant additional costs beyond those currently contemplated to comply with existing requirements. Any of the foregoing could have a material adverse effect on our business. The threat of climate change continues to attract considerable attention in the United States and foreign countries and, as a result, our operations are subject to regulatory, political, litigation and financial risks associated with the use of fossil fuels, including coal refuse, and emission of GHGs. New or amended legislation, executive actions, regulations or other regulatory initiatives pertaining to GHG emissions and climate change could result in the imposition of more stringent standards and could result in increased compliance costs or costs of operations. Failure to comply with such requirements could result in the shutdown of a non-complying facility, the imposition of liens, fines, and/or civil or criminal liability and/or costly litigation before the agencies and/or in state of federal court. Additionally, political, financial and litigation risks may result in us restricting, delaying or canceling the extent of our business activities, incurring liability for infrastructure damages as a result of climatic changes, or impairing the ability to continue to operate in an economic manner. The regulatory environment has undergone significant changes in the last several years due to state and federal policies affecting wholesale competition and the creation of incentives for the addition of large amounts of new renewable generation and, in some cases, transmission. Fuel conservation measures, alternative fuel requirements and increasing consumer demand for alternative energy sources (such as Pennsylvania’s Tier I Alternative Energy Sources, including solar photovoltaic energy, wind power, and low-impact hydropower) that do not generally have the adverse environmental impact or regulatory scrutiny associated with the combustion of coal or other fossil fuels could also reduce demand for coal refuse power generation facility activities. The occurrence of one or more of these developments could have a material adverse effect on our business, financial condition and results of operations. 37 Furthermore, cryptocurrency Mining has become subject to increased scrutiny regarding its energy consumption and impact on global emissions. In the future, the EPA or other regulatory authorities may propose and finalize additional regulatory actions that may adversely affect our facilities, including our Scrubgrass and Panther Creek power generation facilities, or our ability to cost-effectively develop any new generation facilities. Various environmental activist groups and non-governmental organizations have also lobbied for emissions and energy use monitoring and reporting requirements for cryptocurrency Mining companies or even more extensive regulation of the cryptocurrency Mining sector. These efforts have the potential to lead to increased regulatory burdens on our Mining operations and cause us reputational harm by highlighting cryptocurrency Mining’s impact, however proportionate or disproportionate compared to other economic sectors, on global emissions. We are unable to predict whether currently proposed legislation or regulatory initiatives will be implemented, but any action by the jurisdictions in which we operate to restrict, limit, condition, or otherwise regulate our power production or crypto asset Mining operations, as part of a climate change or energy transition policy initiative or otherwise, could adversely affect our business, financial condition, and results of operations. We operate in a complex and rapidly evolving energy regulatory environment, and we are subject to a wide range of laws and regulations enacted by U.S. federal, state, and local governments, governmental agencies, and regulatory authorities. We operate in a complex and rapidly evolving energy regulatory environment, and we are subject to a wide range of laws and regulations enacted by U.S. federal, state, and local governments, governmental agencies, and regulatory authorities. From a federal energy regulatory perspective, these include PURPA, the Federal Power Act (FPA), and the Public Utility Holding Company Act (PUHCA), in each case as administered by the Federal Energy Regulatory Commission (FERC). We are also subject to compliance with requirements imposed by PJM under its tariff, which may also be enforced by FERC. As a result, our business is subject to substantial energy regulation and may be adversely affected by legislative or regulatory changes, as well as liability under, or any future inability to comply with, existing or future energy regulations or requirements. We are subject to the jurisdiction of FERC because, through Scrubgrass and Panther Creek, we own and operate FERC-jurisdictional facilities that make wholesale sales of energy in interstate commerce. However, because these facilities are QFs under PURPA, they are exempt from a number of provisions of the FPA applicable to FERC’s traditional utility regulatory jurisdiction, as long as we satisfy the requirements to maintain QF status. We expect to continue to satisfy these requirements. The energy regulatory environment has undergone significant changes in the last several years due to load growth and to state and federal policies affecting wholesale competition and the creation of incentives for the addition of large amounts of new generation and transmission to meet that load growth and maintain grid reliability. Increasing new and projected load growth includes actual and announced additions of large data centers in the principal region in which we operate—PJM—to meet the growing HPC and AI compute needs. These changes are ongoing, and we cannot predict the future design of the wholesale power markets or the ultimate effect that the changing regulatory environment will have on our business. In addition, in some of these markets, interested parties have proposed material market design changes, including the elimination of a single clearing price mechanism, as well as proposals to reinstate the vertically-integrated-monopoly model of utility ownership or to require divestiture by generating companies to reduce their market share. If competitive restructuring of the electric power markets is reversed, discontinued, delayed, or materially altered, our business prospects and financial results could be negatively impacted 38 Increasing scrutiny of our ESG practices and the impacts of climate change could increase our operating costs, divert management attention from our strategic goals, and adversely affect our business. Companies across many industries, including Bitcoin Mining and digital infrastructure, are facing scrutiny related to their environmental, social, and governance (“ESG”) practices. Investor advocacy groups, certain institutional investors, investment funds and other influential investors are also increasingly focused on ESG practices and in recent years have placed increasing importance on the environmental and community impacts of their investments. Enhanced public awareness and concern regarding environmental risks, including global climate change, may result in increased public scrutiny of our business. As a result, our management’s time and energy may be diverted from executing on our strategic goals towards responding to such scrutiny and further advancing our ESG practices, which may not necessarily enhance the value of our Common Shares or positively impact shareholder return. In addition, the impacts of climate change may affect the availability and cost of materials, natural resources and sources and supplies of energy, which may increase the cost of our operations. Changes in U.S. federal policy, including actions by the current administration signaling a shift away from supporting renewable energy, could result in fewer renewable energy projects being constructed and lead to increases in electricity prices, which may adversely affect our energy costs and the availability of renewable power for our operations. Other factors which may impact our profitability include, but are not limited to, fluctuating demand for Bitcoin and other cryptocurrencies, insurance and other operating costs, and damage incurred as a result of extreme weather events. New environmental laws, regulations or industry standards may be adopted with little or no notice to us and may impose significant operational restrictions and compliance requirements on our operations. The cost of compliance with changes in government regulations has the potential to reduce the profitability of our operations or cause delays in the development of new digital infrastructure projects. If we are classified as a passive foreign investment company, United States holders of our shares may suffer adverse tax consequences. Generally, if prior to the U.S. Redomiciliation, in any taxable year 75% or more of our gross income is passive income, or at least 50% of the average quarterly value of our assets are held for the production of, or produce, passive income, we would be characterized as a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes. We do not believe we were a PFIC for 2025 and do not expect to be a PFIC for 2026. However, PFIC status is determined annually, and whether we will be a PFIC for any future taxable year is uncertain. Moreover, the application of the PFIC rules to cryptocurrency such as bitcoin and transactions related thereto is subject to uncertainty. Accordingly, there can be no assurance that Bitfarms will not be classified as a PFIC for any taxable year. If we are characterized as a PFIC, United States holders of our shares who hold our shares before the U.S. Redomiciliation may suffer adverse tax consequences, including the treatment of gains realized on the sale of our shares as ordinary income, rather than as capital gain, the loss of the preferential income tax rate applicable to dividends received on our shares by individuals who are United States holders, and the addition of interest charges to the tax on such gains and certain distributions. A United States shareholder of a PFIC generally may mitigate these adverse U.S. federal income tax consequences by making a Qualified Electing Fund (“QEF”) election, or, to a lesser extent, a mark-to-market election. We do not intend to provide the information necessary for United States shareholders to make a QEF election if we are classified as a PFIC for any year. Risks Related to Ownership of Our Common Shares The profitability of our operations has been and will continue to be significantly affected by the high volatility of Bitcoin prices, which could adversely affect our financial condition and the trading price of our Common Shares. The profitability of our operations has been and will continue to be significantly affected by changes in the spot price of Bitcoin. Bitcoin prices in particular are highly volatile, fluctuating due to numerous factors beyond our control, including speculation and incomplete information, rapidly changing investor sentiment, changes in technology, regulatory changes, fraudulent or malicious actors, media coverage of Bitcoin, inflation, and political or economic events, as well as market acceptance and demand for Bitcoin. The market price of one Bitcoin, in our principal market, ranged from approximately $87,000 to $126,000 during the year ended December 31, 2025. Although we may partially hedge our investment in Bitcoin, such hedging practices may not adequately protect us from Bitcoin’s price volatility and surrounding risks. Currently, we do not use a formula or specific methodology to determine whether or when we will sell Bitcoin that we hold, or the number of Bitcoin we will sell. Rather, decisions to hold or sell Bitcoin are currently determined by management by analyzing forecasts and monitoring the market in real time. Such decisions, however well-informed, may result in untimely sales and even losses, adversely affecting an investment in us. Further, some of the business decisions (e.g., purchases of Miners and debt financing) we have made, and may in the future make, were or will be tied to the price of Bitcoin at the time of each of those decisions. If Bitcoin spot prices decline and remain at low market levels for a sustained period while Network Difficulty does not decrease proportionally, our results of operations and financial condition, as well as the trading price of our Common Shares, could be materially adversely affected. 39 Bitcoin and related Mining Equipment may be subject to momentum pricing, which is typically associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for anticipated future appreciation in value. Further, the price of Mining Equipment is often tied to the price of Bitcoin, influenced by factors such as Mining difficulty and the value of corresponding rewards. Bitcoin market prices are determined primarily using data from various exchanges, over-the-counter markets and derivative platforms. Momentum pricing may have resulted, and may continue to result, in speculation regarding future appreciation in the value of Bitcoin, inflating market prices and making those market prices more volatile. As a result, Bitcoin market prices may be more likely to fluctuate due to changing investor confidence in future appreciation (or depreciation) in their market prices, which could adversely affect the trading price of our Common Shares. In addition, the securities markets have from time-to-time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. Specifically, the trading price of our Common Shares is, and, in the future, is likely to continue to be, highly correlated to the trading price of Bitcoin. Bitcoin Mining companies’ stock have shown volatility relative to Bitcoin. For example, the closing price of our Common Shares on Nasdaq as of December 31, 2025 was $2.35 and the closing price of Bitcoin was approximately $87,509 and, as of December 31, 2024, the closing price of our Common Shares was $1.49 and the closing price of Bitcoin was approximately $93,429. Our operating results and financial condition have been and may continue to be adversely affected by declines in Bitcoin market prices, resulting in plans and obligations that we assess and likely will continue to reassess, particularly in light of potential general declines in Bitcoin market prices, to determine the practicality, profitability and timeline of such plans and commitments. The market price of our Common Shares has fluctuated significantly and may continue to do so, which could result in substantial losses for shareholders. The market price of our Common Shares fluctuates significantly in response to several factors, most of which we cannot control and many of which have not necessarily been related to our operating performance, underlying asset values or prospects. The market price of our Common Shares ranged from $0.68 to $6.47 on Nasdaq and CAD$0.98 to CAD$9.10 on the TSX from January 1, 2025, to December 31, 2025. Other factors that may impact the trading price of our Common Shares include, but are not limited to: ● volatility in the price of Bitcoin; ● actual or anticipated fluctuations in our results of operations and/or future prospects; ● recommendations by securities research analysts; ● changes in the economic performance or market valuations of companies in the industry in which we operate; ● addition of or departure of our executive officers, directors, and/or other key personnel; ● additional sales or perceived sales of our Common Shares; ● operating and financial performance that vary from the expectations of management, securities analysts, and investors; ● regulatory changes affecting the industries in which we operate generally and our business and operations; ● announcements of developments and other material events by us or our competitors; 40 ● fluctuations to the costs of vital products and services used by us in our business; ● changes in global financial markets, global economies, and/or general market conditions, such as interest rates; ● significant acquisitions or business combinations, strategic partnerships, joint ventures, or capital commitments by or involving us or our competitors; ● litigation or regulatory action against us; ● news reports, investor speculation, social media, chat rooms, and other methods of information dissemination concerning trends, concerns, technological, or competitive developments, regulatory matters, and other related issues in our industry or target markets; ● the level of short interest in our share; and ● current and future global economic, political, and social conditions. In the past, following periods of volatility in the market price of a company’s securities, securities class-action litigation has often been brought against that company. We may become the subject of such litigation in the future, which litigation may be expensive to defend and may divert Management’s attention and resources from the operation of our business. In addition, we must comply with the continued listing requirements of Nasdaq, the TSX or any other securities exchange on which our securities are listed in the future to avoid our securities being delisted. A delisting from Nasdaq and/or the TSX would result in our Common Shares being eligible for quotation on the over-the-counter (“OTC”) market, which is generally considered to be a less efficient system than listing on a national exchange, such as Nasdaq and the TSX, because of the OTC’s lower trading volumes, transaction delays and reduced security analyst and news media coverage. These factors could contribute to lower prices and larger spreads in the bid and ask prices for our Common Shares. Future sales, or the perception of future sales, by our shareholders in the public market could cause the market price for our Common Shares to decline. The sale of shares of our Common Shares in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of our Common Shares. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that it deems appropriate. We do not intend to pay dividends on our Common Shares for the foreseeable future. Because we do not currently intend to pay any dividends on our Common Shares for the foreseeable future, our shareholders will not be able to receive a return on their shares unless they sell them. We currently intend to retain all available funds and any future earnings to fund the development, expansion and growth of our business and execute our strategic initiatives. As a result, we do not currently anticipate declaring or paying any cash dividends on our Common Shares in the near future. Any decision to declare and pay dividends in the future will be made at the discretion of our Board and will depend on, among other things, our business, financial condition, results of operations, cash requirements and availability, industry trends, and other factors that the Board may deem relevant. Any such decision also will be subject to compliance with contractual restrictions and covenants in the agreements governing our indebtedness. We may also incur additional indebtedness, the terms of which may further restrict or prevent us from paying dividends on our Common Shares. Unless we pay dividends, our shareholders will not be able to receive a return on their shares unless they sell them. There is no assurance that shareholders will be able to sell shares when desired. Our inability or decision not to pay dividends could also adversely affect the market price of our Common Shares. 41 Risks Related to the U.S. Redomiciliation We may fail to realize the perceived benefits of the U.S. Redomiciliation, including as a result of our shares of not being included in a U.S. stock market index. There can be no assurance that all of the anticipated benefits of the U.S. Redomiciliation will be achieved. Achieving the anticipated benefits of the U.S. Redomiciliation is subject to a number of risks and uncertainties, including factors that we do not and cannot control. In addition, if the perceived benefits of the U.S. Redomiciliation do not meet expectations of investors or securities analysts, the price of our Common Shares following completion of the U.S. Redomiciliation may decline. We pursued the U.S. Redomiciliation because we believe that the U.S. Redomiciliation will be beneficial to our business and operations, our shareholders and other stakeholders over the long-term. We believe that the U.S. Redomiciliation will raise the profile and marketability of our capital stock in the United States through, among other things, the ability to attract deeper pools of passive investment capital in the United States, particularly if shares of our Common Shares are included in certain US stock market indices and other investment vehicles that only include securities of US-incorporated companies. However, following the U.S. Redomiciliation, when the Common Shares are removed from Canadian stock market indices and if shares of our Common Shares are not included in such U.S. stock market indices, this could result in increased selling pressure and/or decreased demand for our Common Shares that would increase stock price volatility or cause the market price of the shares of our Common Shares to fall. Initial inclusion and continued inclusion in a stock market index or fund is not guaranteed and is subject to numerous factors which can be applied subjectively by the entity managing the index or fund. If not listed on a designated stock exchange, there will also be an absence of certain tax benefits, such as the Company’s Common Shares being qualified investments for trusts governed by registered plans under the Canadian Tax Act. There are no assurances that we will be included in any US stock market indices or funds in a timely manner, or at all. Even if we are included in a US stock market index or fund, the entities managing such indices or funds may change their inclusion criteria, resulting in the future exclusion from such index or fund. The success of the U.S. Redomiciliation will depend, in part, on our ability to realize the anticipated benefits associated with the U.S. Redomiciliation and associated reorganization of our corporate structure, and we may not be able to realize such benefits on a timely basis or at all. The U.S. Redomiciliation may result in sales of shares of our Common Shares by certain retail and institutional shareholders or investment funds that are not permitted to hold shares of a U.S. company under their internal guidelines. The U.S. Redomiciliation may result in sales of shares of our Common Shares by certain retail and institutional shareholders or investment funds (including Canadian-focused funds) that are not permitted to hold shares of a U.S. company under their internal guidelines or are limited in the size of any such investments. Such sales could result in increased selling pressure and/or decreased demand for our Common Shares, which could increase stock price volatility or cause the market price of the shares of our Common Shares to fall. As a result of the foregoing, certain of these investors may be required under their internal guidelines to sell their shares at times when, or at prices for which, they would otherwise not have sold. If an investor sells its shares at a time when the market price is lower than their cost basis in the shares, the investor will suffer a loss that could be significant to such investor. The success of the U.S. Redomiciliation will depend, in part, on our ability of to realize the anticipated benefits associated with the U.S. Redomiciliation and associated reorganization of our corporate structure, and we may not be able to realize such benefits on a timely basis or at all. 42 We will incur non-recurring costs related to the U.S. Redomiciliation. We have incurred and expect to incur a number of non-recurring costs associated with the U.S. Redomiciliation. There can be no assurance that the actual costs will not exceed those estimated and the actual completion of the U.S. Redomiciliation may result in additional and unforeseen expenses. In addition, we have incurred and will incur legal, accounting and other professional services fees and other costs related to the U.S. Redomiciliation. Most of these costs will be payable whether or not the U.S. Redomiciliation is completed. While it is expected that benefits of the U.S. Redomiciliation achieved by us will offset these transaction costs over time, this net benefit may not be achieved in the short-term or at all, particularly if the U.S. Redomiciliation is delayed or does not happen at all. In addition, we may incur increased compliance costs arising from complying with both the U.S. and Canadian ongoing reporting and disclosure regimes. These combined factors could adversely affect our business, operating profit and overall financial condition. We have changed the financial reporting standards that we apply to our financial statements from IFRS Accounting Standards to U.S. GAAP and, as a result, some of our financial data derived from U.S. GAAP financial statements may not be easily comparable to historical financial results derived from historical IFRS financial statements. Our financial statements included in this Annual Report on Form 10-K have been prepared in accordance with U.S. GAAP and will no longer be prepared under IFRS Accounting Standards as we previously did, and any changes in accounting standards and subjective assumptions, estimates and judgments by management related to complex accounting matters as a result of the application of U.S. GAAP instead of IFRS Accounting Standards could significantly affect our reported financial results or financial condition. Our historical filings of consolidated interim period and full year financial statements were previously prepared in accordance with IFRS Accounting Standards and may not be comparable to financial statements prepared according to U.S. GAAP. Although generally similar in principle, U.S. GAAP includes specific disclosure requirements that are not explicitly required under IFRS Accounting Standards. Therefore, disclosures provided under IFRS Accounting Standards and U.S. GAAP may differ depending on the nature of the risks and uncertainties associated with the underlying transaction. In addition, U.S. GAAP and related accounting pronouncements, implementation guidelines and interpretations are highly complex and involve many subjective assumptions, estimates and judgments, including with regard to a wide range of matters that are relevant to our business, including (but not limited to) revenue recognition, business combinations, impairment of property, plant and equipment, intangibles and goodwill, right-of-use assets, prepaid expenses and other assets, income taxes, liabilities and litigation. Changes in these rules or their interpretation or changes in underlying assumptions, estimates or judgments could significantly change our reported financial performance or financial condition in accordance with generally accepted accounting principles. In connection with this transition, we have invested significant resources and time to convert historical financial statements prepared under IFRS Accounting Standards from prior fiscal years into U.S. GAAP financial statements. There are significant differences between U.S. GAAP and IFRS Accounting Standards, including differences related to intangible assets, capitalized development costs, lease accounting, income tax, treatment of warrants and other convertible securities. As a result, one may not be able to meaningfully compare our financial statements under U.S. GAAP with our historical financial statements previously provided under IFRS Accounting Standards.